The present invention discloses an improved process for the preparation of gold nanorod encapsulated mesoporous silica nanohybrid (GMS) and use of these nanorods for the preparation of targeted drug delivery system based on folate like biomolecule-conjugated mesoporous silica encapsulated gold nanorods that can cater several needs during diagnosis and/or treatment such as bio-imaging, chemo-photothermal therapy, hyperthermia and photothermal ablation along with targeted delivery.