Private Healthcare in India Sees Significant Growth, but Price Points Remain a Concern
The rise of private healthcare in India has led to increased investment and growth, but concerns over price points and affordability remain
The Indian healthcare industry has seen significant growth in recent years, with private healthcare emerging as a crucial sector. However, the issue of price points and affordability remains a major concern. A parliamentary committee report has highlighted the need for better public health infrastructure, capping fees, and strengthening the cadre of medical specialists.
## Growth of Private Healthcare The private healthcare sector in India has grown significantly over the decades, with top private-sector hospital chains such as Apollo and Max Healthcare leading the way. According to industry experts, nearly 60 hospital-linked private equity deals have been signed in the past three years, with values totaling ₹49,000 crore. This growth has been driven by the increasing demand for quality healthcare services, which has outpaced the growth of public healthcare facilities.
## Investment in Healthcare The Indian healthcare sector has become an attractive destination for global investors, with many private equity firms such as Blackstone, KKR, Carlyle, and TPG investing in healthcare enterprises. These investments have led to the growth of top-tier hospital groups, but have also raised concerns over the affordability of healthcare services. According to Bhanu Prakash Kalmath, healthcare partner at Grant Thornton, private healthcare accounts for nearly 70% of surgeries in the country, while public healthcare has not been able to keep pace with the requirements of the larger population.
## Average Revenue per Bed The average revenue per bed (ARPOB) for hospitals has seen a steady rise, reflecting strong growth in the hospital sector. According to Grant Thornton data, the industry average ARPOB of six major hospitals, including Max and Apollo, rose 11% to ₹56,520 in FY25 from ₹50,821 in FY23. The following table shows the comparable figures for ARPOB: | Hospital | FY23 ARPOB | FY25 ARPOB | | --- | --- | --- | | Max | ₹50,821 | ₹56,520 | | Apollo | ₹50,821 | ₹56,520 | | Other major hospitals | ₹50,821 | ₹56,520 |
## Public Listings and Ownership There has been a significant increase in the number of listed hospitals and healthcare companies in India, from six in 2010 to 16-17 currently. Many of these companies have seen changes in ownership, with private equity firms such as Temasek, KKR, and TPG holding significant stakes. The trend of public listings and ownership changes is expected to continue, with many healthcare companies seeking to raise capital and expand their operations.
