Hospital Chains Set to Expand with 14,500 New Beds by FY2027

Eleven listed and two unlisted hospital chains plan to add 14,500 beds by FY2027, investing Rs 32,000 crore. The industry expects robust occupancy rates, revenue growth, and profit margins, driven by organized market share, insurance uptake, and rising non-communicable diseases. New beds will mostly be in tier-II cities.

The Indian healthcare sector is poised for significant expansion, with eleven listed hospital chains and two unlisted entities planning to introduce around 14,500 new beds by the fiscal year 2027, according to a report by rating agency ICRA. This move signifies a capital expenditure of about Rs 32,000 crore.

The sector is projected to uphold strong occupancy levels between 62 to 64 percent, alongside a 6 to 8 percent rise in average revenue per occupied bed. Healthy profit margins are anticipated, resting between 22 to 24 percent. These optimistic projections are bolstered by structural dynamics such as increasing market share for organized players, a rise in insurance coverage, and the growing prevalence of non-communicable diseases.

Significant capital expenditure plans are underway to meet the projected demand. The upcoming addition of new beds, representing approximately 26 percent of the current capacity by the end of FY2025, targets tier-II cities including Nagpur, Lucknow, and Coimbatore, aiming to address unmet healthcare needs in these areas.

(With inputs from agencies.)