Trivitron banks on global markets for healthy growth

GSK Velu, CMD of the healthcare concern based in Chennai, says, “A sizeable chunk of our revenue Is generated from international markets which exceeds the domestic business. This year, we are slated to touch Rs 700 cr in turnover. Although there is a push for ‘Make in India’ and we may be progressing on that front, there have been no specific incentives to access government tenders. Growth in the global markets is much better, particularly in regions like the Middle East and Africa.” 

In Africa, the company has launched a joint venture with Investment Fund for Africa (IFHA). This JV has also been financed by International Finance Corporation (IFC), which will be a partner. “Our idea is to cover all 54 African nations by establishing hubs in South Africa, Nigeria, Kenya and Uganda where we plan to have direct offices,” he adds. 

Velu explains that Africa is behind India by about three decades in terms of health services and access to medical technologies. “We are trying to sell our products, also tie-up with other MNCs besides distributing their products. We are presenting a single entity to the customer, akin to Trivitron’s original avatar in 1997-2007, when we represented MNCs like Siemens and Boston Scientific, which later made their direct debut in India. These companies still seek a credible distributor in Africa. But, we have adopted a dual strategy, as we have our own products from our factories which will be sold. This will be supplemented by MNC products, he says.” 

While this strategy would help Trivitron offer a comprehensive single source of supplies for Africa, the company is also looking at providing turnkey solutions there. Trivitron is vying for a share in the neo-natal segment, which involves a two-level screening – basic and extended. 

As the US typically spends around $100 to $150 per infant for extended screening, which is borne by the government, the company is looking for a foot-hold in the extended screening space.

“We are making a headway into the US market, where USFDA approval is pending for a product to screen newborns (which was inaugurated by the PM). A global leader in neonatal screening is PerkinElmer, which has a manufacturing unit about 100 km away from our 100 per cent subsidiary Lab Systems Diagnostics in Finland. The global market for newborn screening devices is estimated to be over $600 mn, of which $400 mn is the demand for US alone. And 80 per cent of it is monopolised by the American company, he notes.” In India too, the company wants to emerge as a turnkey solution provider for services such as critical care and clinical diagnostics. 

He points to the transformational strategy of moving away from trading business to establishing itself as a manufacturing entity. The company’s nine factories are spread across Chennai, Pune, Helsinki and Ankara. “The tenth one is ready to be commissioned in the Technology Park in Chennai. Right now, all factories are operating at less than 10 per cent capacity utilisation. But, if this goes to 45 per cent, then, we can become a $1 billion revenue company,” he says. 

He sums up, “Transformational change needs to happen, which means import independence for those in the medical devices space. Manufacturing needs to be made attractive in India. Two out of our 10 factories are outside India. In the future, we may have to reconsider this. In Turkey, our capacity utilisation is 90 per cent. We have many such countries calling us to set up our manufacturing bases there. Even in Finland, the capacity utilisation is more than 70 per cent.”