By Rishika Sadam
HYDERABAD, Aug 26 (Reuters) – Swedish healthcare provider Medicover’s India business is on track to have all 25 hospitals in its network become profitable within 18 months, driven by rising occupancy and demand for specialised care, a top executive said on Wednesday.
Earlier this month, global investment firm KKR signed a deal to buy Medicover’s India business for €1.2 billion ($1.40 billion), pending regulatory approvals.
“Our debt position was increasing, which led to us talking to private equity,” Medicover India’s Executive Director Harikrishna P told Reuters in an interview.
Of Medicover’s 25 hospitals in India, 19 are profitable, he said, adding that the group expects core profit margins to improve to 20-25% from 14% currently in the next 12 to 18 months.
The hospital chain, which has an overall capacity of 6,000 beds, plans to increase its occupancy by 67% to 4,000 beds in the next 18 months, he said.
Funds from the KKR deal will be used to scale up Medicover’s existing facilities, increasing operational beds, he said, adding that the unit’s name will be changed once the deal receives regulatory approvals.
KKR’s buyout adds to a string of private equity investments in Indian healthcare, after the firm’s investments in Baby Memorial Hospital and Healthcare Global.
The deals reflect increasing global private equity interest in India’s healthcare market, driven by a high chronic disease burden in the country and greater insurance penetration driving demand for healthcare.
Blackstone acquired a controlling stake in Hyderabad-based CARE Hospitals in 2023. That same year, BPEA EQT acquired a majority stake in fertility-services provider Indira IVF.
The boom has also seen private hospital chains such as Apollo and Manipal expand aggressively through greenfield and brownfield investments to add bed capacity.
($1 = 0.8573 euros)
(Reporting by Rishika Sadam and Kashish Tandon; Editing by Janane Venkatraman, Sonia Cheema and Ronojoy Mazumdar)
