Baby Veronica, who celebrated her first birthday last month, has a grin that puts smiles on the faces of everyone in the neonatal intensive care unit.

Proud parents Manisha and Lehri Bhall were at her bedside. The Rowville couple have been by their first child's side every day since she was born in the back of an ambulance on Wellington Road.

Despite Veronica's severe health problems - she weighed 844grams at birth and could fit in the palm of her mother's hand - her parents never doubted she would make it.

Mrs Bhall said Veronica needed a ventilator and feeding through a tube. "It was touch and go when she was first born.

"I couldn't hold my daughter until she was three months old. I used to come in first thing in the morning and just hold her hand until it was night-time. We were always here, every day for our daughter."

Mrs Bhall said Veronica's condition worsened in November when her lungs collapsed.

"She was critically ill for four months but look at her now - she never cries, she's always smiling, blowing raspberries and sometimes laughing."

Nurse unit manager Alison Medhurst credited Veronica's reaching her first birthday to the love she was given by her parents.

"Most premature babies will go home by their due date but each year we get about one baby who needs to stay up to a year."

Mrs Bhall said Veronica loved her singing elephant toy, watching Hi-5 DVDs and listening to music.

Spending her days at the unit has also inspired Mrs Bhall to study nursing. She hopes to specialise in paediatrics.

Veronica now weighs a healthy 9.5kilograms and, if her lung condition improves, Mr and Mrs Bhall will be able to take her home in about a month.

"Since March she's come off the ventilator and made big steps," Mrs Bhall said.

"It used to be hard to hold her with the ventilator but now Veronica can put her arms around me and give her mum a proper cuddle."