Country wide Income Tax raid on Apollo Hospitals

In a country wide search operation Income Tax officials raided the Apollo Group of Hospitals. The raid was carried out on the morning of 5th Jan across the chain of hospitals. Raids were carried out in all its premises, also its corporate office and even the offices of its Chairman and Managing Director.

Apollo Hospitals is the nation's largest healthcare chain. The Company’s healthcare facilities comprise of primary, secondary, and tertiary care facilities. It operates over 8,617 beds across 50 hospitals, 1,632 pharmacies, over 100 primary care and diagnostic clinics, and 115 tele-medicine units across 10 countries.

According to the media reports over 250 officials of the I-T department, in nearly 50 separate teams, began their search early morning. However, the officials refused to disclose further details about the scale of inquiry and details of possible seizure of documents.

Early in the morning, the  company released a statement saying: "The I-T department visited our hospitals today and we extended our complete co-operation to them. We have always conducted ourselves with the highest degree of diligence and would like to reassure our patients, shareholders and stakeholders that we shall uphold their trust and faith in us."

Meanwhile, when reports of the search operation first came in, shares of Apollo Hospitals, which had scaled a high of Rs. 1,497, fell to Rs. 1,431.55 on the BSE. However, today the shares closed with minor losses.

On further queries regarding the scale of inquiry and details over tax violations, or property searches, yielded little from officials, who said the search is ongoing and could take more time.However, as part of its raids, the Income Tax department on Tuesday stalled financial transactions of the group at Hyderabad. However, the day-to-day operations of the hospital were not affected.

On the financial front the company has been doing well. Apollo's total revenue from operations increased by 18.37 per cent to Rs 5215 crores in FY15 from Rs 4406 crores in FY14. The EBITDA stood at Rs 734 crores with an increase of 9.39 per cent from Rs 672 crores in FY14. The EBITDA margin stood at 14.19 per cent compared to 15.32 per cent. The net profit stood at Rs 340 crores with an increase of 7.31 per cent from the previous year. The company has a total debt of Rs 1813 crores as of FY15.

The operational and financial impact of the Income Tax raid is yet to be ascertained.