EXHIBIT 1: PERFORMANCE OF FIRMS OPERATING IN THE HEALTHCARE INDUSTRY [As on March 31, 2015 (in INR Millions)]

S No Name of Companies Total Assets Total Revenue

1 Apollo Hospitals Enterprise Ltd. 58,199.90 46,380.70
2 Fortis Healthcare Ltd. 51,554.20 8,333.80
3 Fortis Hospitals Ltd. 23,253.70 20,275.50
4 Narayana Hrudayalaya Ltd. 13,175.40 13,176.20
5 Max Healthcare Institute Ltd. 14,674.20 8,226.70
6 Escorts Heart Institute & Research Centre Ltd. 12,123.60 4,313.60
7 S R L Ltd. 10,170.50 5,478.50
8 Indraprastha Medical Corpn. Ltd. 4,633.80 7,144.00
9 Healthcare Global Enterprises Ltd. 7,115.50 4,244.40
10 Tamil Nadu Medical Services Corpn. Ltd. 10,086.50 340.2

p[
h 31, 2015 (in INR Millions)]
PAT
3,466.00
-339.1
-856.7
210
-381.4
252.5
475.7
324.9
-23.7
1.2
 Apollo Hospital Fortis Health
Sources Of Funds
Total Share Capital 695.6 4628.1
Equity Share Capital 695.6 4628.1
Reserves 30,915.10 32,167.00
Networth 31,610.70 36,795.10
Secured Loans 13,140.50 674.8
Unsecured Loans 2025.3 5298.5
Total Debt 15,165.80 5973.3
Total Liabilities 46,776.50 42,768.40

Application Of Funds
Gross Block 31,791.10 2843.7
Less: Accum. Depreciation 7515.7 942.5
Net Block 24,275.40 1901.2
Capital Work in Progress 5121.6 1690
Investments 7130.2 24,111.30
Inventories 3325 72.4
Sundry Debtors 5495.5 1050.6
Cash and Bank Balance 2492.3 62.9
Total Current Assets 11,312.80 1185.9
Loans and Advances 10,359.60 22,703.70
Total CA, Loans & Advances 21,672.40 23,889.60
Current Liabilities 10,118.70 8587.4
Provisions 1304.4 236.2
Total CL & Provisions 11,423.10 8823.6
Net Current Assets 10,249.30 15,066.00
Total Assets 46,776.50 42,768.50

Contingent Liabilities 14,247.90 5489.7

Book Value (Rs) 227.21 79.5
 Profit & Loss account (in Rs million as of March 31, 2015)
Apollo Hospitals Fortis Healthcare Ltd.
Income
Sales 45,927.90 6106.4
Other Income 305.8 2205.6
Stock Adjustments 0 12.8
Total Income 46,233.70 8324.8
Expenditure
Raw Materials 14,041.50 0
Power & Fuel Cost 0 119.4
Employee Cost 7209.6 1824.5
Other Manufacturing Expenses 10,690.80 1485.8
Miscellaneous Expenses 7698 4176.3
Total Expenses 39,639.90 7606

PBDIT 6593.8 718.8

Interest 832.9 806.3
PBDT 5760.9 -87.5
Depreciation 1580.4 271.3
Profit Before Tax 4180.5 -358.8
Tax 1207.3 -19.7
Reported Net Profit 3466 -339.1
Total Value Addition 25,598.40 7606
Equity Dividend 800 0
Corporate Dividend Tax 163.8 0
Per share data (annualised)
Shares in issue (in millions) 139.13 462.81
Earning Per Share (Rs) 24.91 -0.73
Equity Dividend (%) 115 0
Book Value (Rs) 227.21 79.5
 EXHIBIT 4: DETAILS OF SHAREHOLDERS HOLDING MORE THAN 5% SHARES
(As on August 30, 2015)
Name of Shareholders Number of Shares Percentage Holdings
Dr. Devi Prasad Shetty 66,744,179 33.37%
Shakuntala Shetty 64,126,703 32.06%
JP Morgan Mauritius Holdings IV Limited 21,811,524 10.91%
Ashoka Investment Holdings Limited 17,259,108 8.63%
CDC Group Plc 11,765,046 5.88%
 EXHIBIT 5: BOARD OF DIRECTORS OF NARAYANA HRUDAYALAYA
As on August 29, 2015

S No Board Members Age Designation

Dr. Devi Prasad
1 Shetty 62 Chairman and Executive Director
Dr. Ashutosh
2 Raghuvanshi 53 Managing Director & CEO

3 Viren Shetty 31 Whole-time Director

Kiran Mazumdar
4 Shaw 62 Non-Executive Director

5 Harjit Singh Bhatia 66 Non-Executive Director

Dinesh Krishna
6 Swamy 61 Independent Director
Muthuraman
7 Balasubramanian 71 Independent Director

8 Arun Seth 64 Independent Director

9 B. N. Subramanya 58 Independent Director

Manohar D.
10 Chatlani 63 Independent Director
F DIRECTORS OF NARAYANA HRUDAYALAYA
As on August 29, 2015

Details
Founder of the company and Cardiac surgeon by profession with around
33 years of experience.
A cardiac surgeon with overall experience of 26 years and has been part of
the Company since its early days.
A civil engineer by profession responsible for identifying new growth
opportunities for the Company and has eight years of experience.
The chairperson and managing Director of Biocon Limited. She is a first
generation entrepreneur with more than 39 years of experience in the
field of biotechnology.
Around 42 years of experience and also a certified associate of the India
Institute of Bankers. He was appointed as nominee director of Ashoka
Holdings and Ambadevi
A founding member of Infosys Limited with around 34 years of
experience.
A professional with over around 43 years of experience, served on boards
of several organizations.
Currently on the board of several companies and also a trustee of the
Nasscom Foundation, this drives corporate social responsibility initiatives
for the IT industry.
Around 30 years of experience, a fellow member at ICAI since April 13,
1994.
A business man with over 40 years of experience in the retail sector,
business development and leadership roles.
 Balance Sheet (in INR million)
For the year ended 31st March
Particulars 2011 2012 2013 2014 2015
EQUITY AND LIABILITIES
[A] Shareholders' funds
Share capital 3.25 3.25 3.25 3.25 2000
Reserves and surplus 4,857.39 5,147.22 5,331.67 5,693.50 5,912.99
Total 4860.64 5150.47 5334.92 5696.75 7912.99

[B] Non-current liabilities

Long-term borrowings 872.75 1,112.67 1,731.89 2,172.17 1,593.36
Deferred tax liabilities (net) 152.78 175.01 190.36 241.15 272.89
Other long-term liabilities - 8.65 15.17 20.86 46.22
Long-term provisions 25.99 48.01 54.50 61.47 97.78
Total 1,051.52 1,344.34 1,991.92 2,495.65 2,010.25

[C] Current liabilities

Short-term borrowings 0 0 293.22 522.17 943.47
Trade payables 526.94 692.91 764.06 1,552.87 1,222.04
Other current liabilities 545.13 543.03 864.18 973.83 778.73
Short-term provisions 25.65 36.23 25.21 38.06 65.90
1,097.72 1,272.17 1,946.67 3,086.93 3,010.14

TOTAL (D = A + B + C) 7,009.88 7,766.98 9,273.51 11,279.33 12,933.38

ASSETS
[E] Non-current assets
(i) Fixed assets
a) Tangible assets 4,066.13 4,068.29 4,984.75 6,194.67 6,424.77
b) Intangible assets 3.56 3.49 50.13 70.18 30.72
c) Capital work-in-progress 366.88 725.57 421.83 121.04 88.53
d) Intangible assets under
development 30.66 68.75 22.69 - -
(ii) Non-current investments 58 125.27 314.42 513.72 2,408.20
(iii) Long-term loans and advances 1,451.27 1,532.86 1,679.82 1,926.82 1,465.15
(iv) Other non-current assets - - 13.41 13.06 8.76

Total 5,976.50 6,524.23 7,487.05 8,839.49 10,426.13

[F] Current assets

Inventories 251.87 271.41 364.02 473.87 482.63
Trade receivables 462.28 672.44 914.7 1,331.50 1,430.65
Cash and bank balances 172.99 138.11 229.25 223.13 233.71
Short-term loans and advances 113.9 116.2 204.07 281.87 241.25
Other current assets 32.34 44.59 74.42 129.47 119.01

Total 1033.38 1242.75 1786.46 2439.84 2507.25

TOTAL (G = E + F) 7,009.88 7,766.98 9,273.51 11,279.33 12,933.38
 Profit & Loss (in INR million)
For the year ended 31st March
Particulars 2011 2012 2013 2014 2015
INCOME
Revenue from Operations 4,729.20 6,470.57 8,250.72 10,758.14 13,075.65
Other Income 26.22 23.77 22.76 155.02 100.53
Total Revenue 4755.42 6494.34 8273.48 10913.16 13176.18

EXPENSES
Purchase of medical consumables,
drugs and surgical equipments 1,616.76 1,965.47 2,401.18 2,866.45 3,286.36
Changes in inventories of medical
consumables, drugs and surgical
equipments -95.42 -19.54 -92.61 -109.85 -8.76
Employee benefits 771.79 1,108.33 1,539.22 1,924.04 2,640.64
Other expenses 1,850.27 2,579.28 3,545.44 4,855.68 5,833.36
Total expenses 4,143.40 5,633.54 7,393.23 9,536.32 11,751.60

Profit before interest, tax,

depreciation and amortization 612.02 860.80 880.25 1,376.84 1,424.58
Finance costs 52.25 87.04 156.78 266.95 347.07
Depreciation and amortisation 313.89 355.68 439.69 546.81 619.56
Profit before tax, as restated 245.88 418.08 283.78 563.08 457.95

Tax Expense
Current Tax 68 106 84 152 137
Deferred tax charge/ (credit) 32.8 22.25 15.33 50.79 31.75
Minimum Alternate Tax credit entitl -28.96 - - - -
Total tax expenses 71.84 128.25 99.33 202.79 168.75

Profit/(loss) for the year/period, as

restated 174.04 289.83 184.45 360.29 289.20
 Restated Standalone Summary Statement of Cash Flow (in INR million)
For the year ended 31st March
Particulars 2011 2012 2013 2014 2015
Cash flow from operating activities
Profit before tax, as restated 245.88 418.08 283.78 563.08 457.95
Adjustments:
Foreign exchange unrealized (gain)/loss, net -0.4 -0.5 - - -1.09
Depreciation and amortization 313.89 355.68 439.69 546.81 619.56
Provision for other than temporary diminution in the value
of long-term investments - - - 30.46 10.74
Interest income on bank deposits and others -7.70 -4.39 -4.20 -6.41 -32.12
Interest expense and other borrowing costs 52.25 87.04 156.78 266.95 347.07
Profit on sale of non-current investment - - - -93.02 -
(Profit) / loss on sale of fixed assets -1.77 - - 0.29 2.58
Operating cash flow before working capital changes 602.15 855.91 876.05 1,308.16 1,404.69
Changes in trade receivables -252.43 -210.16 -242.26 -416.8 -99.15
Changes in inventories -95.42 -19.54 -92.61 -109.85 -8.76
Changes in other assets -22.11 -12.25 -28.4 -55.05 26.05
Changes in loans and advances -124.61 -104.99 -139.44 -134.08 -267.1
Changes in liabilities and provisions 332.32 196.36 244.22 1,248.09 -246.41
Cash generated from operations 439.90 705.33 617.56 1,840.47 809.32
Income taxes paid, net -101.12 -131.59 -172.28 -195.79 -199.83
Net cash generated from operating activities (A) 338.78 573.74 445.28 1,644.68 609.49

Cash flow from investing activities

Purchase of fixed assets -983.66 -850.75 -1,071.67 -1,221.80 -803.07
Investment in subsidiary -146.31 -19.58 -189.25 -403.92 -377.38
Movement in deposits (having original maturity of more
than three months), net 116.05 26.74 -1.85 -22.84 -50.60
Movement in deposits (due to mature after 12 months from
the reporting date), net - - -13.4 1.68 2.39
Payment for acquisition of long-term investment - - -0.26 -2.74 -883.95
Government grant received - - 50 170 -
Proceeds from sale of fixed assets 3.79 - - - 10.11
Purchase of assets on slump sale - - - -419.83 -
Proceeds from sale of non-current investments - - - 168.78 -
Share application money received - - - - 300
Unsecured loan given to related parties -224.24
Repayment of loan by related party 85.68
Interest received on bank deposits and others 7.7 3.37 2.76 4.74 18.43
Net cash (used in) investing activities (B) -1002.43 -840.22 -1223.67 -1725.93 -1922.63

Cash flow from financing activities

Proceeds from long-termborrowings 614.07 468.02
932.27 502.38 985.8
Proceeds from short-term borrowings - - 225 - 300
Repayment of long-term borrowings -81 -125.02 -202.61 -418.59 -2,744.06
Repayment of short-term borrowings - - - -225 -50
Change in bank overdrafts 0.19 - 68.22 453.95 171.3
Proceeds from issue of debentures - - - - 1,000.00
Expenses incurred in relation to issue of debentures - - - - -16.85
Proceeds from issue of equity shares - - - - 2,000.06
Expenses incurred in relation to issue of shares - - - - -56.18
Interest and other borrowing costs paid -48.45 -84.65 -155.22 -264 -316.95
Net cash provided by / (used in) financing activities (C) 484.81 258.35 867.66 48.74 1273.12
Net (decrease) / increase in cash and cash equivalents
(A+B+C) -178.84 -8.13 89.27 -32.51 -40.02
Cash and cash equivalents at the beginning of the
year/period 313.64 134.8 126.67 215.94 187
Cash and cash equivalent acquired on slump sale basis - - - 3.57 -
Cash and cash equivalents at the end of the year/period 134.8 126.67 215.94 187 146.98
-
 Historical Financial Data from FY 2011 to FY 2015

2011 2012 2013

Total Revenue 4755.42 6494.34 8273.48

Revenue Growth Rate 0.3656712 0.2739524
Expenses 4143.4 5633.54 7393.23
Expediture % of Sales 0.8713005 0.8674538 0.8936058
EBITDA 612.02 860.8 880.25
EBITDA Margin 12.87% 13.25% 10.64%
Minus: Depreciation & Amortization 313.89 355.68 439.69
Depreciations % of Sales 6.60% 5.48% 5.31%
EBIT 298.13 505.12 440.56
EBIT Margin 6.27% 7.78% 5.32%
Taxes 104.3455 176.792 154.196
Net Income 193.7845 328.328 286.364

EBIT 298.13 505.12 440.56

Plus: Depreciation & Amortization 313.89 355.68 439.69
Minus: Taxes 104.3455 176.792 154.196
Operating Cash Flow 507.6745 684.008 726.054
Minus: Δ Net Working Capital* 162.25 150.58 258.49
Change in Net Working Capital % of Sales 3.41% 2.32% 3.12%
Minus: Gross P&E Expenditure** 983.66 850.75 1,071.67
Equals: Enterprise Cash Flow -638.24 -317.32 -604.11

Notes:
*Obtained by substracting 'Cash generated from operations' from 'Operating cash flow before working capital changes' in cash flow statement.
**Purchase of fixed assets (CAPEX) from Cash Flow Statement
 Average Rates
2014 2015
of FY 2011-2015
(in %)
10913.16 13176.18 8722.52
0.3190532 0.2073662 0.29
9536.32 11751.6 7691.62
0.8738367 0.8918822 0.88
1376.84 1424.58 1030.90
12.62% 10.81%
546.81 619.56 455.13
5.01% 4.70% 5.42%
830.03 805.02 575.77
7.61% 6.11%
290.5105 281.757 201.52
539.5195 523.263 374.25

830.03 805.02 575.77

546.81 619.56 455.13
290.5105 281.757 201.52
1086.3295 1142.823 829.38
-532.31 595.37 126.88
-4.88% 4.52% 0.02
1,221.80 803.07 986.19
396.84 -255.62 -283.69

nges' in cash flow statement.

Assumptions
Corporate Tax 35%
Terminal Growth Rate

Result of Historical Analysis Between Financial Year 2011 to 2015

Average Sales Growth Rate 29.15%

Average Expenditure Rate (% of Total Revenue) 87.96%

Depreciation (% of Total Revenue) 5.42%

Per Year percentage decrease in the depreciation -6.56%
Changes in Net Working Capital (% of Total Revenue) 1.70%
Average Plant and Equipment Expenditure per year 986.19
 NARAYANA HE

2015 2016 2017

Assumed Growth Rate 29.15% 29.15% 29.15%
Total Revenue (in Rs Millions) 13176.18 17017.04 21977.50
Expenses 14968.45 19331.76
EBITDA 2048.58 2645.74

Minus: Depreciation & Amortization 922.48 1191.38

EBIT 0.00 1126.10 1454.36

EBIT*(1-t) 731.97 945.34

Plus: Depreciation & Amortization 922.48 1191.38
Minus: Δ Net Working Capital* 289.14 373.43
Minus: P&E Expenditure per year** 922.48 1191.38
Equals: Enterprise Cash Flow 0.00 442.82 571.91

Year 0.00 1.00 2.00

PVF 1.00 0.89 0.79
Discounted Cash Flow 0.00 394.37 453.59

PV of Cash Flows 18791.28

Terminal Value 229183.69
PV of Terminal Value 40293.25

Total Operating Value 59084.52

Excess Cash Left at end of the Period* 146.98

Equals: Enterprise Value 59231.50

Minus: Value of long-term debt 2010.25
Equity Value 57221.25 57221253259
No of Equity Shares 200012523.22
Per Share Value 286.09
 NARAYANA HEALTH CASE: DCF VALUATION

2018 2019 2020 2021 2022 2023 2024 2025 2026

29.15% 29.15% 29.15% 29.15% 29.15% 29.15% 29.15% 29.15% 29.15%
28383.94 36657.86 47343.63 61144.30 78967.86 101987.00 131716.21 170111.48 219698.98
24966.97 32244.84 41644.21 53783.49 69461.38 89709.38 115859.66 149632.75 193250.69
3416.98 4413.03 5699.42 7360.81 9506.48 12277.62 15856.55 20478.73 26448.28

1538.67 1987.19 2566.46 3314.58 4280.78 5528.63 7140.22 9221.60 11909.70

1878.31 2425.84 3132.97 4046.23 5225.70 6748.99 8716.32 11257.13 14538.59

1220.90 1576.79 2036.43 2630.05 3396.71 4386.85 5665.61 7317.14 9450.08

1538.67 1987.19 2566.46 3314.58 4280.78 5528.63 7140.22 9221.60 11909.70
482.28 622.87 804.43 1038.93 1341.77 1732.90 2238.04 2890.43 3732.99
1538.67 1987.19 2566.46 3314.58 4280.78 5528.63 7140.22 9221.60 11909.70
738.62 953.92 1231.99 1591.12 2054.93 2653.94 3427.57 4426.71 5717.09

3.00 4.00 5.00 6.00 7.00 8.00 9.00 10.00 11.00

0.71 0.63 0.56 0.50 0.44 0.40 0.35 0.31 0.28
521.71 600.06 690.17 793.82 913.03 1050.15 1207.86 1389.25 1597.88
 2027 2028 2029 2030 Particulars
29.15% 29.15% 29.15% 29.15%
283741.23 366451.80 473272.50 611231.43 Revenue Growth Rate^
249583.27 322336.80 416297.97 537648.83 Expediture % of Sales
34157.96 44115.00 56974.52 73582.60 Depreciations % of Sales
Change in Net Working
15381.37 19865.04 25655.70 33134.34 Capital % of Sales
Gross P&E Expenditure
18776.58 24249.96 31318.82 40448.26 Growth Rate
WACC

Assumptions:
Year
12204.78 15762.47 20357.23 26291.37 2021
15381.37 19865.04 25655.70 33134.34 2022
4821.16 6226.53 8041.56 10385.67 2023
15381.37 19865.04 25655.70 33134.34 2024
7383.62 9535.95 12315.68 15905.70 2025
2026
2027
12.00 13.00 14.00 15.00 2028
0.25 0.22 0.20 0.18 2029
1837.84 2113.84 2431.29 2796.41 2030

Terminal Growth Rate

Corporate Tax Rate

Average Rates*

29.15%
87.96%
5.42%

1.70%

12.29%

Growth Rate^^

5.00%

35.00%
Data
Debt (in million Rs) 2010.25
Equity 34013.61
D/E 0.06
D+E 36023.86

WACC Calculation 12.29%

Risk free rate of return* 6.50%
Beta** 0.63 0.596 considered asset beta
Equity Risk Premium*** 9.71% then it is relevered by multiplying asset beta*(

Cost of Equity 12.63%

Cost of Debt 10.00%
Cost of Debt (Post Tax) 6.50%

WACC

Notes:
*Indian Govt Bond Generic Bid Yield (10 Years)
Ref: http://www.bloomberg.com/quote/GIND10YR:IND
**Average Beta of Competitors (Apollo & Fortis) Levered & Unlevered
***http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html (As of July 2016)
multiplying asset beta*(enterprise value/equity)
 Terminal Growth Rate
3.00% 4.00% 5.00% 6.00% 7.00%
10.00% 14.71 17.33 21.00 26.50 35.67
WACC

11.00% 12.88 14.86 17.50 21.20 26.75

12.00% 11.44 13.00 15.00 17.67 21.40
12.11% 11.31 12.82 14.77 17.35 20.94
13.00% 10.30 11.56 13.13 15.14 17.83
14.00% 9.36 10.40 11.67 13.25 15.29
Transaction Multiples of Comparable Trading Companies

Price
S No Comparable Firms in Healthcare Industry P/E Ratio Book
Ratio

1 Apollo Hospitals Enterprise Ltd. 54.82 6.01

2 Fortis Healthcare Ltd. -225.41 2.07
Average

VALUATION
Based on Apollo as comparable 273107.10
Equity value
Based on Fortis as comparable 32912.06
Based on Apollo as comparable 1365.45
Per Share Value
Based on Fortis as comparable 164.55

Equity Value Average 153009.58

Per Share Value Average 765.00
 Enterprise Share
EV/EBITDA Price on BV per EV Sales EBITDA
Value-Sales EPS
Ratio 31st Share
Ratio
March
4.43 30.84 1365.45 24.91 227.21 203330.97 45927.90 6593.80
14.33 121.69 164.55 -0.73 79.50 87474.27 6106.40 718.80