Private Hospitals Surge: Witnessing Robust Growth in Revenue and Expansion

Private hospitals are on track for significant revenue growth, with an expected increase of 14-15% in the next fiscal year, according to Crisil Ratings. This would make it the fifth consecutive year of double-digit growth, bolstered by expansion in bed capacity and high-value treatments.

Crisil Ratings notes that robust demand and operating leverage are helping maintain operating margins at 20-21% despite ongoing investments. Most of these expenditures are covered by strong internal revenues, reducing the need for external borrowing and maintaining healthy credit profiles for these institutions.

New facilities are ramping up faster than anticipated, with many private hospital chains actively expanding through a combination of brownfield, greenfield, and acquisition strategies. Over fiscal years 2024-2026, acquisitions totaling Rs 11,000 crore and the addition of 4,300 beds are set to facilitate further growth.