Chennai: The New Delhi-based Fortis Healthcare Limited is looking at Southern cities like Chennai to set up hospitals. Present mainly in the national capital region, Fortis Healthcare is expected to have a southern presence in six months time. The company has 11 hospitals under its fold out of which 7 are in the national capital region. Fortis Healthcare is coming up with couple of more hospitals in the northern India.

According to executives, there may not be much of a difference in the operational costs of hospitals in Delhi, Mumbai and in Southern metros. But the lower land cost and also the salary levels in South would give higher profitability.

A southern foray will be relatively peaceful for the company that is bogged down with several court cases questioning the ownership its own name and its usage; the ownership and occupation of the land in which Fortis hospitals are located; and the acquisition of the Escorts hospital.

Group company Ranbaxy Holding Company owns the name Fortis and the logo and Fortis Healthcare pays Rs1 lakh per year as licence fee to Ranbaxy Holding for the right to use the word ''Fortis'' and the logo.

Further, Fortis Healthcare is facing a case in the Delhi High Court filed by Fortis N V, Fortis SA / NV and Fortis Bank (all engaged in banking and insurance activities) asking for permanent and interim injunction to restrain Ranbaxy group from using the word ''Fortis''.

On its part Fortis Healthcare and two other group companies - Fortis Financial Services Limited and Religare Enterprises Limited have filed a case in the Delhi High Court against Fortis N V for a permanent and interim injunction seeking to restrain its use of the ''Fortis'' name to carry on finance, insurance and investment related businesses in India. The Ranbaxy group companies have claimed ownership to the name ''Fortis'' and also damages of Rs2 million for loss of reputation.

Meanwhile, the company is developing hospitals in Jaipur, Delhi, Gurgaon and Navi Mumbai. The outlay is estimated to be in the region of Rs695 crore through fiscal 2010.

Fortis Healthcare is coming out with an initial public offer (IPO) of 45,996,439 equity shares of Rs10 each at a price band of Rs92 - Rs110. Prior to the offer the company has concluded pre IPO of 10,670,194 shares at prices ranging from Rs135 to Rs159.50 per share aggregating to Rs153.69 crore.

The purpose of the fund raising are (a) construction and development of a hospital at Shalimar Bagh, New Delhi by its subsidiary Oscar Bio Tech Private Limited (Rs100 crore) (b) refinance the funds availed for the acquisition of Escorts Heart Institute Research Centre Limited (Rs467 crore) and (c) to prepay some of the short term loans (Rs69 crore).

According to Daljit Singh, president, strategy and organisational development, the company''s business model is to focus on six to eight super specialities, have a deep presence in the regions it is present and have the doctors on its rolls unlike others.

The group hospitals have a total of 1,793 beds and at a nominal investment the number could be increased to 2,500 beds. The addition of four more hospitals will give 900 more beds. The average occupancy at the Fortis hospitals is 72 per cent.