Credit:- Sugandh Khandelwal
Manipal Health Enterprises has been successfully acquired by Temasek, which now holds a majority stake. Temasek now holds a 59% ownership share, solidifying its position as the primary stakeholder in the hospital network for approximately ₹16,300 crore. This makes Temasek the largest shareholder in Manipal Health, which operates a network of over 37 hospitals with more than 10,500 beds across India.
Visit the website link for more information : https://www.manipalhospitals.com/
As per Reuters , Singapore-based sovereign wealth fund Temasek said that it is acquiring an additional 41% stake in India’s Manipal Health Enterprises from investors including TPG, boosting its stake in one of the country’s largest hospital chains to 59%.
Private equity firm TPG, an investor in Manipal since 2015, will fully exit its stake, though it will reinvest via a new fund. India’s sovereign wealth fund, the National Investment and Infrastructure Fund (NIIF), will also sell its full stake to Temasek, while Manipal founder Ranjan Pai’s family holding will reduce from about 50% to 30%. Manipal currently serves over 5 million patients a year through its 29 hospitals in 16 cities with 4,000 doctors, according to a statement issued jointly by the investors.
ROBUST GROWTH ATTRACTS INVESTORS
Investors are increasingly turning their attention to leading Indian healthcare providers like Manipal Hospitals drawn by their robust growth potential and pivotal role in the nation’s healthcare landscape. Manipal Health has become attractive investment opportunity due to the following:
- Strong Brand Value: Both Temasek and Manipal Health are established names in the healthcare sector, known for delivering quality medical care.
- Rapid Expansion: They are expanding footprints with new facilities, adding beds, and upgrading technology to cater to growing demand.
- Medical Tourism: Their reputation attracts international patients, contributing significantly to revenue.
- Favorable Market Dynamics: India’s increasing healthcare needs and government policies like Ayushman Bharat create a fertile ground for private healthcare growth.
- Investor Trust: Past investments in these brands have yielded solid returns, making them reliable bets for global funds.
LARGER TREND EMERGING
The interest in these hospitals underscores a larger trend where India’s healthcare sector is emerging as a beacon for international investors, promising high returns and sustainable growth. Analysts report that ten listed Indian hospital firms plan to increase their combined bed capacity by 47% between FY24 and FY27, primarily in north and south India. Seven new large hospital chains listing on the stock market during this period raised approximately Rs 3,600 crore in primary funding through IPOs and qualified institutional placements, further contributing to the sector’s growth.
For example, India received ₹27,000 crore in hospital sector investments in the past two years, reflecting its growing appeal to domestic and foreign investors. This increase is supported by liberalized FDI policies, which allow 100% investment in hospital projects through the automatic route, and the rising role of private equity in the sector. The hospital industry is projected to grow at a Compound Annual Growth Rate (CAGR) of 18.24% from FY21 to FY27, making it a major driver of the healthcare sector.
The share of hospitals in healthcare Foreign Direct Investment (FDI) in India has indeed grown significantly. In FY21, hospitals accounted for 24% of healthcare FDI. Recent data suggests this share has more than doubled due to increasing investor confidence, driven by factors such as rising demand for healthcare services, government policy support, and the expansion of private hospital chains into Tier 2 and Tier 3 cities.
- Expanding Demand: With India’s growing population and increasing awareness of healthcare, the demand for quality medical services is at an all-time high.
- Medical Tourism: India has emerged as a hub for affordable and world-class healthcare, attracting patients from across the globe.
- Technological Advancements: Indian hospitals are rapidly adopting cutting-edge technologies, enhancing efficiency and outcomes.
- Policy Support: Government initiatives, such as Ayushman Bharat, have made the healthcare sector attractive for investment by ensuring greater access and affordability.
The infusion of $2 billion is expected to accelerate infrastructure development, enhance service quality, and foster innovation, paving the way for India’s hospitals to compete globally. This investment also reflects India’s growing prominence as a preferred healthcare hub.
Source of information: https://www.reuters.com/markets/deals/temasek-acquires-41-stake-indias-manipal-health-2023-04-10/