India's healthcare and drug division witnessed a surge in mergers and acquisitions (M&A) and private equity (PE) investments, recording over $594 transactions between 2022 and 2024, exceeding $30 billion.
Media reports show that the hospital sector has emerged as a major investment destination and is a significant portion of these transactions. The report has raised $4.96 billion from PE investors, with these hospitals in India working for M, highlighting transactions worth $6.744 billion, accounting for 40% and 38% of such transactions over the period.
Additionally, the hospital raised $466 million through its first public service (IPO) reflecting the strong investors' trust in the sector.
“It ranges from 20 to 30 times before valuation, tax, depreciation and amortization (EBITDA), particularly in high demand specialties such as oncology, heart disease and maternal and child care,” the report states.
Foreign direct investment (FDI) in healthcare and diagnostics also saw a significant inflow, reaching $3.2 billion over two years. Additionally, in the first half of FY24-25 (until September), hospitals and diagnostic companies secured $931.46 million in FDI.
The report highlights key investment factors for investment, including integration between multi-specialty hospitals and increased technology integration aimed at strengthening scaling operations and market presence.
Investor interest in single-specialized hospital segments such as nephrology, vitro fertilization (IVF) and oncology has also surged, attracting $1.4 billion in PE investments over two years. These segments gain traction thanks to their lighter assets and scalable business models.
As the healthcare sector continues to evolve, the report suggests that strategic investments and technological advances will play a key role in shaping the future growth trajectory.
