Blitz Bureau
NEW DELHI: India emerged as the largest healthcare private equity (PE) market in 2024 by volume in the Asia Pacific region, accounting for 26 per cent of the region’s total deal volume, a report showed on January 10. India is emerging as a compelling alternative to China for dealmaking, given its expanding middle-class fuelling healthcare demand and its strong economic growth, according to the report by Bain & Company.
Investors have intensified their focus on India. Successful PE exits with strong returns, such as Advent International’s $1.6 billion sale of BSV Group to Mankind Pharma, have also validated India’s buyout market, making it more attractive for future investment.
India’s robust growth is expected to persist, with healthcare spending projected to climb to $320 billion by 2028.
Investors have demonstrated their confidence in India, with funds actively investing in providers, biopharma and related services, the report mentioned.
“Over the past two years, the provider space has seen significant interest with funds showing a strong appetite to pursue build out of platforms given the impressive track record of exits in the space,” said Dhruv Sukhrani, partner at Bain &Company and leader of the India healthcare practice.
Significant opportunity for consolidation continues. Platform build outs in pharma space as well as in providers have been undertaken to bring together relatively smaller assets. Multiple funds (both bulge bracket and mid-market) are increasing their exposure to healthcare.
Among some of the notable examples are Morgan Stanley’s acquisition of a minority stake in the Hyderabad Institute of Oncology; Blackstone’s longer-term buy-and-build strategy with Care Hospitals (acquired in 2023), which will include multiple tuck-in acquisitions; and Advent’s investment in Apollo Hospital Enterprise’s digital health platform, Apollo 24|7.
Additionally, India has consistently delivered favourable returns and has enabled a range of successful exits for PE firms through initial public offerings (boosted by strong public markets), strategic acquisitions (bolstered by acquirers’ strong balance sheets), and sponsor-to-sponsor deals (such as KKR’s nearly $840 million acquisition of Healthium Medtech from Apax Funds).
The report said that with a proven track record, favourable macroeconomic conditions, and a diverse healthcare landscape, India is expected to remain a prime investment location for PE firms.
