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Indian Private Hospital Industry to Generate $45 Billion by 2012
Dec 30, 2009

The Indian private hospital sector is expected to generate revenue of $45 Billion by 2012 on account of heavy investments by private players to expand their services in Tier II and III cities.
According to a report jointly prepared by Yes Bank and the Associated Chamber of Commerce and Industry (Assocham), the Indian private hospitals are expected to generate revenue of $45 Billion by 2012 from the present level of $22 Billion on the back of business expansion in Tier II and Tier III cities, as reported by Sify Business.
The Indian healthcare industry will have a share of $2.5 Billion from the diagnostic and pathology services by 2012 against $1.2 Billion during 2008-09.
The private sector represents 80% of the country’s healthcare delivery market and has been growing at a CAGR of 20%. Nearly 94% of total spending recorded by the private health industry actually comes from out-of-pocket expenditure.
The prime reason for robust growth is heavy pouring of investments by private players who have shown great confidence on the expansion of healthcare services in Tier II and III cities. For example – Dr Lal Path Labs has made plan to take the number of laboratories to 50 and collection centers to 1,000 in the next five years with an investment of Rs 35 Crore.
Moreover, Piramal Diagnostics has made plans to invest Rs 100 Crore to start 10-15 laboratories by 2012 and increase the number of collection centers to 1,000 with increased focus on Tier II and III cities.
Thanks to the economic growth in these cities, the healthcare sector is likely to grow at an exponential rate. With high private equity investments in hospital chains, big investors will contribute immensely to the expansion of private healthcare establishments in remote areas.
The healthcare infrastructure and facilities in the private sector are much better than the public sector. Government healthcare centers offer primary services to patients but they lack necessary equipments, badly maintained and fall short of required quality and standards. On the other hand, private hospitals provide much better services to patients. Thus, patients are choosing private hospitals for their treatments and giving boost to the private sector growth, said “Booming Hospital Services Market in India”, a recent market research by RNCOS.
According to a Research Analyst at RNCOS, “The Indian healthcare sector has immense opportunities for growth by providing affordable quality healthcare facilities. As the healthcare sector will develop, it will create new growth avenues for players with innovative products and business models.”
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