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Clove Dental announces big plans to expand chain of dental clinics

Clove Dental announces big plans to expand chain of dental clinics

Given that each clinic requires capital investment of equipment and infrastructure of Rs 30 lakh to Rs 40 lakh it would imply over Rs 180 crore investment or as Singh preferred to round it off to around Rs 200 crore.

Clove Dental, a leading chain of dental clinics, focused largely in North India at the moment with a total of 118 clinics has announced that it has joined forces with Denty's, an emerging South India-focussed chain of dental clinic.

Talking to journalists in Hyderabad, on Wednesday, Amarinder Pal Singh, CEO of Clove dental (also the name  of the new entity along with Denty's) said, in the next four years, they plan to get to 600 clinics across the country. This means adding 460 more clinics to the 140 today  (118 of Clove Dental and 22 of Denty's).

Given that each clinic requires capital investment of equipment and infrastructure of Rs 30 lakh to Rs 40 lakh it would imply over Rs 180 crore investment or as Singh preferred to round it off to around Rs 200 crore.

"Our plan this coming financial year is to add at least 120 clinics that translates to about two every week or about 10 a month. That is our plan and we are on track. So, exactly one year from now, it will be at least 260 clinics. The math would be based on the cost per clinic which would typically range  between Rs 30 lakh to Rs 40 lakh," he said.

That is not all, he said, "There is an additional investment other than the infrastructure and the capital equipment because you have to operate a clinic till it achieves breakeven and typically the breakeven for a clinic is 12 to 15 months depending on the geography ." Also, that "the proceeds for these would come from the company's financials and the group of shareholders willing to invest." That was one reason, he said, "We are well capitalized and have a shareholder group  that will invest whatever it takes."
 
On their format,  he said, "We will now have a combination of large format clinics and smaller clinics ." As for revenues, he said, "going by our current run rate, we are at Rs 70 crore revenues on an annualized basis and will end the year with perhaps at an even higher number." Clove Dental, launched in 2011, is backed by people like Louis Shakinovsky, chairman of Global Dental Service and  Dr Nitin Doshi, n New York-based entrepreneur, investor, philanthropist and the founder of Dome Equities, which currently has over $ 1.2 B USD under management in multi-family housing throughout the US.
 
Referring to the landscape of dental clinics in the country, Singh said, "In Delhi -NCR region alone there are today around 10,000 dental clinics, Bangalore and Hyderabad have around 8000 clinics each. Therefore, our 600 will therefore still be a drop in the bucket and needs to be seen as a start and our immediate milestone while our long term goal is to go into every neighbourhood in the country." Currently, the focus is on tier 1 cities and that apparently, partly let by the availability of doctors and the fact that there is still huge unmet demand leaving a scope to add more clinics there.