Kites Senior Care, a geriatric care service provider has secured Rs 45 crore in a series A funding round, led by Ranjan Pai, chairman of Manipal Education and Medical Group (MEMG) through his family office, according to ETtech report.
The funds will be used to deepen its presence in cities like Bengaluru, Hyderabad, Chennai, while also facilitating expansion into three additional cities across Southern India, the company said.
The expansion and growth plan entail a total outlay of Rs 65 crores, with Rs 45 crores being infused by Pai and the remaining Rs 20 crore by the promoters themselves, said Rajagopal, who is the cofounder of the company.
Following this with this investment, Pai will hold a 44% stake in the company.
Founded in 2016 by Rajagopal and Reema, Kites Senior Care specialises in a range of geriatric services including post-operative and post-hospitalisation rehabilitative care, palliative care, dementia care, and respite care, both within care facilities and at the residences of senior citizens.
Presently, the company has a team of 400 care professionals, which is expected to grow to over 1500.
Discussing the company’s revenue projections, Rajagopal said that upon full deployment of the investment and achieving 80 to 85% occupancy in its 1098 beds, the company expects a fourfold growth in its revenue to approximately Rs 175 crore.
“We believe that we should be able to do a cash break even for individual facilities once they hit a 50% occupancy level which happens within 12 months from the time we get started. At a peak level of 80 to 90% occupancy level, each of these (facility-based care) units provide an EBITDA at a unit level of around 27 to 30%. That’s the economics that we work with for units,” Rajagopal said. “On the contrary, home-based care business is currently a low-margin business with tough competition around that with the entry barrier being very low.”
Further, the Bengaluru-based company has outlined its intent to utilise the newly raised capital to augment its bed capacity to over 1,000 within the next six quarters, up from the current number of 340. Also, it aims to complete the pilot expansion of its tech platform ‘seniorshield,’ leveraging wearable technology from Titan Fastrack.
“We have closely observed Kites’ deliver the promised plan and building solid foundations of a scalable growth model. This has encouraged us to commit further capital to grow the business to the next stage,” Pai said, commenting on the investment.
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