An Astute Architect

He started Paras Hospitals in 2005. Now, he plans to open a chain of 200-bed hospitals in the tier two cities of North India

Dr Dharminder Nagar (38) Chairman & Managing Director, Paras Hospitals, Gurgaon

Born at Gulaothi village in Ghaziabad in 1970, he did MBBS from JJ Medical College of Mysore University and residency in Safdarjung Medical College, Delhi, before he went to England and joined Imperial College London to study on hospital and health systems. Later, he did MPhil in Hospital Administration from BITS, Pilani.

Why an entrepreneur?

The seeds of his entrepreneurship were sown in London. "Although being a member of a family where entrepenuership was always part of the growing up experience, I had initially gone there to pursue my postgraduate education for Membership of Royal College of Physicians. I nurtured a dream of becoming an accomplished physician. After practicing as a junior doctor in England, I realised that I was not going to become a great doctor, and had no intention to continue as a mediocre one. This was followed by the realisation that I was more interested in the back-end of the hospital than the front end," says re-collects.

He was curious about how medicine was delivered to the ward, who was delivering it, what was the role of the pharmacists, structure of the national health services and its organisation. After he understood his inclinations and forte, he immediately enrolled in Imperial College, London, to study health systems and hospital management. "Much like my father, who founded Paras Dairy in India, I wanted to provide best healthcare facilities at an affordable price," says he.

The first move

He came back to India brimming with optimism and fresh ideas. He wished to sculpt a modern corporate hospital that would be managed efficiently and thus would deliver healthcare at an affordable cost.

He started scouting for land in NCR, as his roots, business, interests— both social and political (one of his brothers is an MP)— lie in that area. After having a feasibility study of the healthcare market done by Medicontrivers, he looked for land in Ghaziabad, Noida and Gurgoan. "It was just that the opportunity for Gurgaon arose first and we acquired the land," explains Dr Nagar.

Unlike other groups, he did not buy the land at a discount. "I wanted to build a corporate hospital that was accountable and thus did not wish to get into the trend of getting discounted land from the Government. I foresaw that the Government would soon clamp down on this trend," he states. The only help he claims to have taken was from his brother Harinder, MD, Paras Buildtech to locate the right land.

The work on Paras Hospitals, Gurgaon was started in January 2005. The Rs 70 crore required for Dr Nagar's dream project was managed through a Debt Equity Ratio of 2:1.

In a short span of 18 months, the hospital commenced operations with neurosurgical cases. The hospital has phased its facilities and bed strength. In the first phase, 130 beds were commissioned in July 2006. Another 50 beds became operational in October 2007. Today, the hospital has 250 operational beds.

Overcoming roadblocks

The biggest hurdle in setting up such a hospital at Gurgaon was the skyrocketing land price. "An international standard hospital needs to stick to some basic criteria so as to create a salubrious environment which helps in faster healing of the sick. Most of the bigger hospitals in the country have managed land from the Government on prices much lower than the market price, but such a facility was not available in Gurgaon. We were conscious of the fact that we have to provide world class healthcare at affordable rates," says he.

The second hurdle was to rope in top doctors. "In this we have been successful and today we can claim with satisfaction that the team of doctors at Paras Hospitals is truly world class," says he.

Mistakes made and lessons learnt

In 1998, he started first entrepreneurial venture with a group of friends in London. The plan was to set up a chain of six lasik eye surgery centres. "I learnt that neither was the market ready for a new chain of lasik eye centres, nor did the group share the same passion, nor was the approval from the Government for the proposed centre in Richmond, West London granted,” says he.

After waiting for nine months, when the permission was rejected, he learnt some important lessons in business. “I learnt that one must analyse the market before one starts a venture, to team up with the right set of people and never wait for a single opportunity to materialise,” says he.

Growth over the years

The hospital is the first green field project of Paras healthcare Pvt. Ltd, started with focus on neurosciences and trauma. In neurosciences, the centre has already done 1,000 surgeries in a span of two years, gradually started one the most advanced centre of Mother and Child with LDR suites and tertiary care neonatal ICU in October 2006. Then the group started with cardiac centre with state of the art cath lab and CTVS OT in March 2008 with an average of more than 50 procedures per month. Other specialities include are the uro-nephro centre with most advanced laser for prostate surgeries, skin and cosmetic surgery. "By end of this financial year we will be adding one most advanced laser eye centre in the region. We have had growth of 75 per cent year on year," says he.

Tips for entrepreneurship

“Firstly, one should know what one wants and be passionate about his goal. Unless the leader is passionate, he cannot motivate and convince others. Secondly, he should have a thorough understanding of the business. It is desirable for one to have qualification or experience in the field one is entering. He rates risk-taking ability as another essential attribute. By that I don't mean impulsive decisions, but taking studied and calculated risks. Courage is another quality an entrepreneur should have to venture into market with the full knowledge that other healthcare giants had already set their eyes on the same market,” says he.

"If Richard Branson could take Virgin Airlines to the zenith of success as a new entrant against eastablished giants like British Airways and American airlines, I believe anybody can make a new venture successful,” says he.

An entrepreneur that he admires in healthcare

Dr Prathap C Reddy of Apollo and Shivinder Mohan Singh of Fortis.

The Road Ahead

"We would like to expand in phased manner with first phase to include an acquisition of mid sized hospital and a new large greenfield hospital in the NCR. Following the execution of same, we would move to phase two where we intend to focus on developing 200-bed hospitals in the tier two cities of North India," informs Dr Nagar. Initially, the expansion would be funded through internal acquisition and then he will consider some equity dilution for the phase two and greenfield projects.