India Set to Lead Asia Pacific's Healthcare Private Equity Market in 2024: Report
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New Delhi, Jan 10 (NationPress) India has established itself as the largest healthcare private equity (PE) market in 2024 by volume in the Asia Pacific region, comprising 26 percent of the total deal volume for the region, as highlighted in a report published on Friday.
According to the analysis from Bain & Company, India is becoming a strong alternative to China for investment opportunities, driven by the growing middle class that is increasing the demand for healthcare services and the nation's robust economic advancement.
There has been a marked increase in investor interest in India. Successful private equity exits, such as Advent International’s $1.6 billion divestment of BSV Group to Mankind Pharma, have reinforced the appeal of India’s buyout market for future investments.
The country's strong development trajectory is anticipated to continue, with healthcare expenditure expected to reach $320 billion by 2028.
Investors have shown their faith in the Indian market, actively channeling funds into healthcare providers, biopharma, and associated services, as noted in the report.
Dhruv Sukhrani, a partner at Bain & Company and head of the India healthcare division, remarked, “In the last two years, there has been considerable interest in the provider sector, with funds eager to construct platforms due to the impressive exit history.”
There remain substantial opportunities for consolidation. Efforts to build platforms in the pharmaceutical sector and among providers are underway to unify smaller entities. Numerous funds, both large and mid-sized, are expanding their investments in healthcare.
Noteworthy transactions include Morgan Stanley acquiring a minority stake in the Hyderabad Institute of Oncology, Blackstone's long-term buy-and-build strategy involving Care Hospitals (acquired in 2023), which will encompass several tuck-in acquisitions, and Advent’s investment in Apollo Hospital Enterprise's digital health platform, Apollo 24|7.
Furthermore, India has consistently produced favorable returns and has facilitated a variety of successful exits for private equity firms through initial public offerings (aided by strong public markets), strategic acquisitions (supported by robust balance sheets of acquirers), and sponsor-to-sponsor transactions (illustrated by KKR’s nearly $840 million purchase of Healthium Medtech from Apax Funds).
The report concluded that given its proven performance, favorable macroeconomic environment, and diverse healthcare ecosystem, India is likely to continue being a top investment destination for private equity firms.
