KIMS Investment an Indicator of the Lucrativeness of India’s Healthcare Sector

In what is being touted one of the largest investment in Indian healthcare sector, the Kerala Institute of Medical Sciences (KIMS) will receive USD 200 million from private equity fund True North. KIMS is an emerging healthcare provider and offers its services in India and Middle East. It has a sizeable presence in the southern Indian city of Kerala, where it has 6 hospitals. Its multi-specialty hospital in Thiruvananthapuram is known for its excellence in offering high-quality services.

Ascent Capital Advisors India Pvt. Ltd and OrbiMed Advisors LLC, the existing investors in the firm, will sell their stake to True North. The move is aimed at expanding the presence of the hospital chain in India and Middle East. According to sources, Group Chairman of KIMS, Dr MI Sahadulla and the management team will continue to run the operations of KIMS.

The healthcare sector in India continues to witness gaps in demand and supply, with government hospitals facing the burden of providing services to millions of patients. Lack of access to quality healthcare has led many middle class Indians to opt for treatment in private hospitals. Venture capitalists have earmarked the Indian healthcare sector as a lucrative territory, and are financing moves by healthcare groups to expand their services.

India is quickly becoming a favourite investment destination for global VCs, and the frenzied interest can be seen in the healthcare sector as well. Foreign direct investment, along with venture capital funding in the healthcare sector has grown substantially in the last five years. Investor sentiment is also positive on account of success of four key IPOs – Thyrocare, Dr Lal PathLabs, HCG, and Narayana Hrudayalaya.

India’s reputation as a medical tourism hub is also growing, as patients in Middle East increasing prefer availing services in India rather than taking a long flight to Europe and the U.S. Recently, Oxa Medical, a Hydrebad-based company, which started operations in December 2016, secured funding from UAE-based investors. Oxa Medical provides curated medical tourism packages to clients. Also, PlanMyMedical Trip, an online platform, received USD 187,000 in angel funding. PlanMyMedicalTrip gives users the best options for availing treatments, and arranges pre- and post-consultation. The platform currently offers medical tourism services in India and Turkey.

Overall, the healthcare sector in India is expected to witness a steady growth in the years to come, owing to increasing emphasis by government. For venture capitalists, India will continue to remain an attractive destination, and it is expected that the scope of investments will remain strong.

About the Author

Anurag Sharma

Delivering high-quality research and consulting projects at tight deadlines remains Anurag Sharma's forte. An experienced market research professional, he has helped business of varied scales make key strategic decisions. Anurag is a specialist in the medical devices market research domain, and has accurately predicted the trends in the market. Anurag is an avid traveller and music aficionado; in his free time, he loves to introspect and plan ahead.

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