Clipped from: https://www.thehindubusinessline.com/economy/indias-healthcare-industry-moves-beyond-bed-counts/article70453123.ece
The sector is still at the cusp of structural transformation; listed hospitals represent just 17 per cent of this universe, leaving large headroom for consolidation.
Between January and October, the sector saw around 139 PE and M&A deals worth $5.5 billion, according to Kaivaan Movdawalla, Partner and National Healthcare Leader at EY-Parthenon India. Deal value has consistently stayed in the $6–7 billion range over the last two years. | Photo Credit: PTI
2025 has been upbeat for the healthcare industry with M&A (mergers and acquisitions) deals and consolidations. This trend is expected to chase healthcare sector in 2026, too.
Big hospital chains were seen stitching together regional networks at an interesting pace in 2025. The spotlight was largely on Manipal Hospitals, Aster DM Healthcare, and Fortis, each reshaping their clusters through sizeable acquisitions.
Manipal Hospitals’ acquisition of Sahyadri Hospitals marked a major expansion in western India. Fortis Healthcare, meanwhile, sharpened its Bengaluru footprint. In December 2025, it signed definitive agreements to acquire TMI Healthcare, which operates the 125-bed People Tree Hospital in Yeshwanthpur, for ₹430 crore. Over the next three years, Fortis will infuse another ₹410 crore to scale the hospital to 300 beds and expand clinical programmes, including radiation oncology.
Aster DM Healthcare is executing a large-scale integration initiative. The merger of Aster DM Healthcare and Quality Care India Limited (subject to regulatory approvals) to form ‘Aster DM Quality Care Ltd’ backed by Blackstone will create a 38-hospital chain spread across southern and central India. The combined entity, Aster DM Quality Care Ltd, will focus on growing its current 10,600 beds to over 14,700 beds in the coming years, entering new geographies such as Madhya Pradesh, Odisha, Tamil Nadu and Chhattisgarh.
In 2025, M&A momentum was supported by buoyant private equity inflows. Between January and October, the sector saw 139 PE and M&A deals worth $5.5 billion, according to Kaivaan Movdawalla, Partner and National Healthcare Leader at EY-Parthenon India. Deal value has consistently stayed in the $6–7 billion range over the last two years.
Yet India’s private healthcare landscape remains highly fragmented. Of the $110-billion healthcare market, private players contribute $40–45 billion, and the organised corporate segment accounts for a mere 30 per cent. Listed hospitals represent just 17 per cent of this universe, leaving large headroom for consolidation.
Aligning cash flow and ambitions
Consolidation isn’t just about swelling bed counts; it also helps build stronger clinical networks, improve insurance coverage, and streamline operations, especially in specialties. Consolidation is primarily being driven by two things – strong free cash flow generation that the sector is witnessing and institutional investor’s ambitions around sustaining/accelerating growth momentum to maximise valuations, said Vishal Manchanda, Senior Vice President, Pharmaceuticals and Healthcare at Systematix Group.
Take ASG Eye Hospitals’ acquisition of Vasan Eye Care in 2023 for ₹526 crore. It gave it access to 150+ centres across southern India. “The amalgamation has been a game-changer,” said Dr Arun Singhvi, MD & CEO, ASG Eye Hospital.
The group now plans further acquisitions to build a national specialty chain. Post acquisition, ASG expects a faster shift toward insured revenue as standardised billing and documentation improve patient access to policies.
With the Sahyadri acquisition, Manipal added 11 facilities and made its entry into key tier-1 and tier-2 cities such as Pune, Nashik, Ahilya Nagar, and Karad, where Sahyadri holds a dominant presence. The same dynamic is playing out in the Aster-QCIL strategic merger. Aster currently derives 31 per cent of revenue from insurance and TPA channels versus 22 per cent for QCIL. The combined entity expects to accelerate insurance penetration as it integrates digital and clinical systems.
With scale accelerating, questions about market concentration are inevitable. But concerns of an oligopoly are misplaced for now, believes Movdawalla.
India has over 2 million beds, of which corporate chains control just 5 per cent, despite contributing nearly 18 per cent of market value. Over the next 10–15 years, India will need roughly one million additional beds. The largest chain is likely to capture only about 1 per cent of incremental capacity annually.
“India’s market is uniquely deep. We have 60-70 per cent of our districts in tier-1 and tier-2 cities. These still lack quality infrastructure. Consolidation is helping fill that gap,” he said.
Road ahead
More capital will chase healthcare assets. Market capitalisation of listed hospital companies, currently around $50 billion, could quadruple to $200 billion in two years, driven by consolidation, new IPOs and stronger institutional ownership.
Scale, however, is only half the equation. “The real value will lie in clinical talent, governance, digital systems and patient experience,” Movdawalla said.
Indian healthcare is on the cusp of a structural transformation, bigger networks, wider access, and stronger quality. The consolidation wave is just getting started.
Published on December 30, 2025
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