Headquartered in Singapore, OUE Healthcare (SGX: 5WA) has an extensive network of healthcare businesses across Singapore, China, Myanmar, Indonesia, and Japan through its sponsorship and largest shareholding in First REIT (SGX: AW9U).
OUE Healthcare aims to leverage collaborations with local partners in the region to scale its healthcare operations in an agile and sustainable manner.
In Singapore, OUE Healthcare has a 60% stake in O2 Healthcare Group, a joint venture with three medical specialist groups focused on respiratory care and cardiothoracic surgeries. It also owns Healthway Medical Corporation Limited, which operates over 130 clinics in Singapore.
In China, OUE Healthcare runs a general hospital in Wuxi, Jiangsu, and a pharmaceutical trading business. It also has a 50:50 joint venture in an Obstetrics & Gynaecology Hospital in Changshu, Jiangsu, and will commission its flagship hospital in Shekou, Shenzhen in 2024.
In Myanmar, OUE Healthcare owns a 40% stake in joint venture companies that own and operate the Pun Hlaing Hospitals brand. Additionally, it holds about 33% of Singapore-listed First REIT, making it the largest unitholder, and a 40% stake in First REIT’s management company.
Here are 5 things you should know about OUE Healthcare’s sustainable healthcare ecosystem in the region.
#1 OUE Healthcare Has Formed Medical Partnerships With Three Respiratory And Cardiothoracic Specialist Groups For Regional Growth, What Are Some Key Developments Since Then?
Since the establishment of O2 Healthcare Group, OUE Healthcare has made significant strides in enhancing its medical partnerships, expanding its roster of specialist doctors to 11 respiratory physicians and two cardiothoracic surgeons, as well as refining its service offerings.
Through a concerted focus on organic growth, the company has intensified marketing efforts and explored opportunities for mergers and acquisitions to further strengthen its position in the market.
Moreover, OUE Healthcare is actively pursuing synergies within the healthcare ecosystem, including collaborations with Healthway Medical Corporation Limited, to drive mutual growth and innovation. These strategic partnerships not only enhance OUE Healthcare’s service offerings but also foster knowledge exchange and resource sharing.
#2 OUE Healthcare’s Joint Venture Recently Commissioned A Hospital In Changshu, How Has The Business Been And What Are Some Challenges Operating It?
We commissioned the Changshu China Merchants-Lippo Obstetrics & Gynaecology Hospital (Changshu Hospital) in May 2023. This is Changshu’s first private obstetrics & gynaecology hospital, and it provides a full spectrum of premium obstetrics and gynaecology healthcare services. The 100-bed hospital is strategically positioned in one of the most economically vibrant and pro-business areas in China.
Changshu Hospital, despite its strategic positioning, faces challenges in the form of demographic shifts and economic fluctuations in China. The country’s declining birth rates and weakened consumer spending sentiments post-pandemic present significant hurdles to the hospital’s growth trajectory.
However, OUE Healthcare remains steadfast in its commitment to overcoming these challenges by intensifying marketing efforts, refining business strategies, and leveraging its partnership with China Merchants Group.
By proactively addressing these challenges and capitalising on growth opportunities, OUE Healthcare aims to position Changshu Hospital for sustained success and continued contribution to the healthcare needs of its community.
Embracing a holistic approach, Changshu Hospital diversified its services to cater to the entire patient life cycle, which includes providing comprehensive care spanning paediatrics, confinement services, medical aesthetics, and postpartum wellness.
#3 How Does First REIT Fit Into OUE Healthcare’s Ecosystem?
OUE Healthcare has a direct holding of approximately 33% in First REIT, which serves as our capital recycling platform and enable us to receive a recurring and stable income and cash flow via its distributions. Through its direct holdings in First REIT, OUE Healthcare gains enhanced financial flexibility, enabling it to reinvest capital into strategic healthcare ventures while maintaining a stable cash flow.
The recent divestment of nursing homes in Japan to First REIT exemplify OUE Healthcare’s asset-light strategy, enhancing its financial position and enabling further expansion of its regional healthcare portfolio. Furthermore, OUE Healthcare’s holdings in First REIT provide a platform for strategic partnerships and collaborations, fostering innovation and growth within the healthcare industry.
#4 What Are OUE Healthcare’s Key Considerations When Expanding Into A New Market Or Business Verticals?
OUE Healthcare’s expansion strategy is underpinned by meticulous considerations, prioritising markets with favourable demographic trends, regulatory environments, and growth prospects.
While OUE Healthcare remains focused on strengthening its presence in existing markets, it also explores opportunities for strategic expansion across Asia, guided by its asset-light strategy and a focus on strategic partnerships.
Key considerations include regulatory environment, political stability, demographics, market potential, economic growth, and sustainable GDP growth, which allows OUE Healthcare to make informed decisions as it seeks to cultivate a robust and diversified healthcare portfolio.
#5 What Are Some Of The Group’s Potential Catalysts That Investors Can Be Excited About In the Near Term Of 1 To 2 Years?
OUE Healthcare stands out from its peers through its distinctive combination of an asset-light business model, strategic partnerships, and holdings in First REIT.
The asset-light model allows OUE Healthcare to focus on healthcare businesses with higher margins and scalability, optimising the efficiency of its financial resources and enhancing its operational agility.
Strategic partnerships with leading conglomerates in Asia provide OUE Healthcare with access to local knowledge, expertise, and resources, enabling the company to create complementary business synergies and explore opportunities for investment in healthcare-related ventures.
Holdings in First REIT serve as a recurring source of stable income and cash flow, bolstering OUE Healthcare’s financial position and providing the company with the flexibility to expand its regional healthcare ecosystem.
Catalysts for growth include the imminent commissioning of Prince Bay Hospital and strategic partnerships for international medical excellence, which underscore OUE Healthcare’s commitment to expansion and value creation for its investors.
OUE Healthcare also remains vigilant of market dynamics and technological advancements, continuously fine-tuning its strategies to adapt to evolving economic conditions and healthcare landscapes. OUE Healthcare’s operational strengths and regional presence position it as one of the leading players in the Singapore healthcare industry, offering investors a unique opportunity to participate in a diversified portfolio that aligns with favourable mega-trends such as demographic shifts, fast-growing middle-class populations, increased urbanisation, and technological innovations.
Editor’s Note: Some answers for this article were extracted from the SGX 10 in 10 series published on 11 June 2024 and have been republished with permission. You can read more on OUE Healthcare on the SGX website.
Read other featured companies from SGX’s 10 in 10 series on the DollarsAndSense website.
The post 10 in 10 with OUE Healthcare (SGX: 5WA), With Healthcare Businesses Across Singapore, China, Myanmar, Indonesia And Japan appeared first on DollarsAndSense.sg.
