Hospital chains to spend around Rs 16k cr on expansion

Hospital chains have already charted sizeable expansion and upgradation plans over the next four to five years. They are undertaking sizeable greenfield and brownfield expansions across both metros and tier II cities. They are expected to add over 4,000 beds and 4,500 beds in FY2025 and FY2026, respectively, with an outlay of Rs 7,000-8,000 crore each in FY2025 and FY2026, respectively. This will see deployment of a cumulative capex of Rs 14,000-16,000 crore, finds ICRA.

Apollo Hospitals has announced that it will add 3,512 beds across 11 locations in India at an investment of around Rs 6,100 crore over the next four years.

Manipal Hospitals, which wants to become the largest tertiary healthcare provider, has undertaken an asset light route to expansion for greenfield ventures. Manipal Health Enterprises will come up with four new hospitals in India, adding about 1,100 beds in its portfolio.

Aster DM Healthcare is in the process of merging with Quality Care India to create one of the top-three hospital chains in India in terms of revenue and number of beds. Aster DM plans to add 1,700 beds in India by FY27, bringing its total bed count to around 6,600 through organic growth.

Fortis is also planning to add 2,200 beds across its existing hospitals over the next three years.

Max Healthcare has announced that it will invest up to Rs 5500 crore over the next 3-5 years to more than double its existing bed capacity. The company currently has 4,000 beds, mainly concentrated in Delhi NCR.

According to ICRA, hospital chains are expected to witness robust revenue growth of 15-17 per cent in FY2025, despite the high base of FY2023 and FY2024. They are supported by healthy occupancy, and robust average revenue per occupied bed (ARPOB).

The increasing penetration of health insurance in metros, tier I and tier II cities is working in favour of large hospital chains.