The Rise Of Private Equity Investment In India’s Healthcare Sector
India is a rapidly growing healthcare market. The sector has witnessed increased private equity investment with international and domestic players. This article explores the health of the Indian healthcare industry, the trends driving its growth, the challenges it faces and how private equity investment can propel it to a global powerhouse.
Introduction to Private Equity
In recent years, private equity has become an increasingly important source of capital for healthcare companies in India. Private equity firms are attracted to the healthcare sector due to its strong growth potential and the large size of the Indian market.
The Indian healthcare sector is expected to record a three-fold rise, growing at a CAGR of 22% between 2016–22 to reach US$ 372 billion in 2022 from US$ 110 billion in 2016. By FY22, Indian healthcare infrastructure is expected to reach US$ 349.1 billion. The e-health market size is estimated to reach US$ 10.6 billion by 2025. The Indian government’s push to increase access to healthcare through initiatives such as Ayushman Bharat is expected to drive further growth in the sector.
With its large population and growing economy, India presents a significant opportunity for private equity firms looking to invest in healthcare. We expect to see continued interest from private equity investors in the Indian healthcare sector in the years ahead.
Reasons for Growth of PE in India
There are several reasons for the growth of private equity investment in India’s healthcare sector:
· The Indian healthcare market is expected to reach USD 372 billion by 2022, making it one of the largest healthcare markets in the world.
· The governments increased focus on healthcare, especially through initiatives like Ayushman Bharat, is expected to drive further growth in the sector.
· Healthcare infrastructure in India is still under-developed, providing significant opportunities for PE firms to invest in and build up these assets.
· The Indian healthcare sector is highly fragmented, with a large number of small and medium sized enterprises (SMEs), which presents attractive opportunities for PE firms looking for consolidation plays.
· With an ageing population and rising incomes, there is a growing demand for better quality healthcare services in India. This presents a huge opportunity for PE firms to invest in and
Impact on Indian Healthcare Sector
The rise of private equity investment in India’s healthcare sector has been a mixed blessing for the country’s healthcare system. On one hand, it has brought much-needed investment into the sector and helped to improve the quality of care. However, on the other hand, it has also led to increased costs, which have put a strain on already stretched budgets.
There is no doubt that private equity has had a positive impact on Indian healthcare. Thanks to the influx of investment, many hospitals and clinics have been able to upgrade their facilities and purchase new equipment. This has resulted in better patient outcomes and a higher standard of care.
However, the downside of private equity is that it has driven up costs. Healthcare services that were once affordable are now out of reach for many people. This is particularly true for those who live in rural areas or who are on low incomes.
The rise of private equity is a complex issue with both positive and negative impacts on Indian healthcare. Ultimately, it is up to the government to decide whether the benefits outweigh the drawbacks.
Conclusion
Private equity firms like Quadria Capital have been increasingly active in India’s healthcare sector in recent years, attracted by the country’s large population and growing middle class. This trend is likely to continue, as more and more Indians seek quality healthcare services. Private equity firms can help meet this demand by investing in new hospitals, clinics and other healthcare facilities. In doing so, they can not only make a profit but also help improve the lives of millions of Indians.