Hospital Market – India

February 2009
Executive Summary

Hospital industry accounts for ~x% of healthcare sector revenues

Market
Estimated to be worth USD XX bn in 2008

Forecast to reach USD XX bn by 2010 growing at y% annually

Drivers: Challenges:

Poor public healthcare infrastructure
High start-up cost and capital
Drivers &
Challenges

P E

Increasing spend on healthcare services

L

Increase in lifestyle-related diseases

Medical tourism
expenditure

Shortage of medical professionals

Competition S M

Nascent but growing medical insurance

A

Private sector dominates with x% market share, led by groups like ABC, EFG and XYZ

New entrants include domestic firms like AA, BB, CC and DD

Foreign entrants exploring the market for partnerships, acquisitions and greenfield projects

Favourable policies on FDI and taxations will increase foreign participation

Private equity investing significantly; investment set to increase, especially in regional hospitals
Future
Large hospital groups making strategic acquisitions but future opportunities may be limited
Outlook
Evolving concept of “health cities”, which have scale and provide a host of satellite services

Emergence of telemedicine for rural areas with participation from private sector and government

Despite increase in number of beds, supply constraints will remain in top cities

HOSPITAL MARKET – INDIA.PPT 2

•Market Overview
•Drivers & Challenges
•Competition
•Future Outlook

HOSPITAL MARKET – INDIA.PPT 3

 Indian Hospital Industry accounts for half of the healthcare
sector's revenues and growth is estimated at y% annually
Overview Market Size and Growth
•Hospitals are a major component of the Indian Diagnostics
Healthcare industry contributing to x% of Pharma w% Insurance &
z% Medical Equipment
industry revenues x%
•Estimated to be worth USD XX bn in 2008
•Growing at y% p.a.
•Expected to reach USD XX bn by 2010
•Fragmented with a large number of
PLE y%
Hospital
independent, privately run hospital and
healthcare centres
•Demand for healthcare far exceeds supply due
to dismal performance by the government SAM USD bn
35
30
a%
X
Y
Z

25 W
•A huge shortage of beds is a major driver for V
20
investment in a growing industry 15

Specialty hospitals in particular are expected to 10
grow faster than overall industry due to rise in
5
heart diseases and cancer
0
2006 2007 2008 2009 2010

Source:

HOSPITAL MARKET – INDIA.PPT 4

Drivers & Challenges

Drivers
Dismal government performance in
providing healthcare infrastructure Challenges
Growing demand for quality care and High start-up cost and capital
increasing ability to pay expenditure
Mounting instances of lifestyle
Shortage of medical professionals
diseases requiring hospitalization
Rapid growth of India as a destination
for medical tourism
Increasing penetration of medical
insurance

HOSPITAL MARKET – INDIA.PPT 5

 Private players dominate the hospital market and with more
entrants and investments, this dominance is likely to continue
Competition Public vs. Private sector share
•Hospital industry is dominated by the private
sector with x% market share Public Sector
•Hospital industry in India is extremely y%
fragmented due to the large number of
nursing homes and small- to mid-sized
hospitals
•Large private players are leading industry
PLE x%

M
Private Sector
growth

competition is limited due to the large

untapped potential of the market
SA
•New players are also entering the market and
New Market Players

• ABC
Domestic International
• AA, USA
• EFG • BB, Dubai
• XYZ • CC, Singapore
• DD, USA
• EE, USA

Source:

HOSPITAL MARKET – INDIA.PPT 6

Hospital industry in India has a bright future and will see
significant investments from foreign firms, private equity and
domestic players
Government policies on FDI and tax are encouraging foreign companies to enter
the market

Private equity firms are investing significantly in hospitals, both large corporate
chains and standalone regional hospitals

Large hospital chains use acquisitions that offer growth at a lower cost but future
opportunities may be limited
Future
Outlook `

Major hospital chains are investing in “health cities”, which have scale and provide
a host of satellite services

Telemedicine is emerging as a feasible option for public and private sector facilities
to provide basic medical care to rural areas

Despite increase in number of beds with significant contribution by top four private
groups, supply constraints will remain in top cities

HOSPITAL MARKET – INDIA.PPT 7

 Thank you for the attention
The Hospital Market report is a part of Research on India’s Healthcare Industry Series.
For more detailed information or customized research requirements please contact:

Gagan Uppal Gaurav Kumar

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