PREPARED BY;

DEVA MALAR VENGRASALAM (ZP03320)

MOGANA RAWAN (ZP03316)
LYNN AL JARRAH (ZP03436)
PARIMALA CHANDRAN (ZP03476)
 DEMAND,SUPPLY &
INTRODUCTION- PRODUCTION
HEALTHCARE FUNCTION,MARGINAL CONCLUSION
MARKET GROWTH ANALYSIS AND
ELASTICITY

GDP ,DEMOGRAPHIC
BUSINESS ECONOMICS
DATA &
ANALYSIS
EMPLOYEMENT RATE

PORTER FIVE FORCES

FISCAL POLICY
& ACTION PLAN
• DDDDD
 ENTRY
High
• Barriers to entry - guidelines and
regulations.
• Changes in the policies.
• Private hospital licensing policy

POWER OF INPUT SUPPLIERS POWER OF BUYERS

Varies Low
Levels,
• Pharamaceutical Companies • Has the same customer base as its
Growth &
- High (for patented medicines/drugs) competitors.
Sustainability
- Low (for generic medicines/drugs) • Changes in policies – a change in
• Medial Equipment Suppliers - High fiscal policy influence the
consumers buying power.

INDUSTRY RIVALRY SUBSTITUTES & COMPLEMENTS

Low Low
• Pricing is similar. Quality of service • No substitute. Patients need to find
is different among competitors. healthcare services in the same
• Provide high quality healthcare industry.
and maintain a high standard at all • There is no alternate
facilities to mitigate competition product/service expect traditional
risk. method like herbs and acupuncture.
 Future Expansion Plan
Several major projects are
currently under development:
• St. Andrew's Private Hospital
in Ipswich, Brisbane;
• Mental health facilities in
Sydney (Northside Clinic) and
Melbourne (Albert Road
Clinic).
Continue to Invest in Facilities
and Technology
• To ensure that can attract the
best specialists and meet the
growing needs of community.
• How to best support patients
beyond hospital walls and the
community pharmacy strategy
will help them to do that.
Retail Community Pharmacy
Strategy
Plan to establish an extensive
network of retail pharmacy
franchises which is close
proximity to hospitals throughout
the country (currently there are
22 pharmacies.
Continuous Development of
Human Capital
Place a great emphasis on the
continuous development and
nurturing of its human and
intellectual capital to ensure the
group's ability to sustain its long
term.
Government adjustment on spending levels and tax rates. Any
changes in Australian government policy and regulation may have an
impact on the health sector more specifically the private health care
sector.

The most common fiscal policy tools are taxes and subsidies such as
free or subsidized provision of health services, tax incentives for
health care purchases etc.

Pharmaceutical Benefits Scheme: to ensure that all can continue to

have access to affordable medicines (details of the medicines
subsidized by the Australian Government)

Medicare Benefits Scheme: to ensure that all can continue to access

timely and affordable health care. Medicare Benefits Schedule
(MBS), a listing of the Medicare services subsidized by the Australian
government.
Government adjustment on spending levels and tax rates. Any
changes in Australian government policy and regulation may have an
impact on the health sector more specifically the private health care
sector.

The most common fiscal policy tools are taxes and subsidies such as
free or subsidized provision of health services, tax incentives for
health care purchases etc.

Pharmaceutical Benefits Scheme: to ensure that all can continue to

have access to affordable medicines (details of the medicines
subsidized by the Australian Government)

Medicare Benefits Scheme: to ensure that all can continue to access

timely and affordable health care. Medicare Benefits Schedule
(MBS), a listing of the Medicare services subsidized by the Australian
government.
120

100

80

60

40

20

0
2007-06 2008-06 2009-06 2010-06 2011-06 2012-06 2013-06 2014-06 2015-06 2016-06

Revenue COGS Gross Margin

Using a bottom-up analysis
of key variables we
estimate that only a 0.1%
change in the 10-year
CAGR of the real pricing
RHC receives from insurers
equates to a 3.1%
differential in RHC
valuation.

Scenario analysis indicates

that a continuation of
historical pricing dynamics
(i.e. a 1.1% CAGR) would
result in RHC's Australian
hospitals' ROIC rising from
14.7% (FY13E) to 18.5%.
• The increase in real pricing can be somewhat attributed to RHC
leveraging its high market share, high-quality, large-scale facilities,
strong doctor relationships and blue-chip hospital locations (i.e. North
Shore Private, Greenslopes, Hollywood) to gain real pricing growth from
insurers

• Inflation over the period was 2.6%, meaning that RHC achieved real
pricing CAGR of 1.1% over the FY09–FY13 period. The achievement of
real pricing growth cannot be explained by an ageing population
The share price has
gone from $1.69 in
July 1998 to $82.97
in August 2016

Annual growth rate

(CAGR) of 16.8%.
Reflecting this,
dividends per share
have increased
over the same
period at a CAGR of
16.7%!