Industry Odisha Bureau, Oct 25: Private equity firms and strategic buyers are consolidating India’s pharma and hospital sectors. The platform model offers scale. Overseas targets and lower valuations abroad are drawing Indian acquirers too.
Platform deals are gaining ground across India’s pharmaceutical and healthcare sectors, says Subhakanta Bal. He heads healthcare and consumer (India) at Rothschild & Co. as managing director. Private equity firms and strategic buyers are pursuing scale through acquisitions, he told Mint.
The platform model follows a buy-and-build strategy. An investor first acquires a strong anchor business. It then adds smaller companies or brands to widen scale and capabilities. Bal said the approach suits larger private equity funds for several reasons. Scale is the first benefit. Combined businesses can save on procurement, supply chains and overheads, and invest in technology. Larger companies may also attract more interest at exit, particularly through public listings. Such premiums, however, are never guaranteed.
ChrysCapital offers a clear pharmaceutical example. In July, it completed buying a 70.68% stake in Novartis India from Novartis AG. The deal brought established domestic brands such as Voveran, Calcium Sandoz and Tegrital. ChrysCapital has since added brands through tie-ups and purchases from multinationals. These include the Indian trademarks for Pfizer’s hypertension brand Minipress. Owning such trademarks differs from owning the original multinational’s business.
KKR is applying the same logic to hospitals. In August, it agreed to buy Medicover AB’s Indian hospital business for about $1.4 billion. KKR already owns Kerala-based Baby Memorial Hospital, acquired in 2024, and oncology chain HCG. Baby Memorial bought Kozhikode-based Meitra Hospital in 2025. In April, KKR was reported to have agreed to buy 60% of Hyderabad’s Star Hospitals. Wider networks can centralise purchasing and spread medical technology costs. Larger size, though, does not automatically improve care quality.
Private equity is not the only driver. Bal said domestic strategic buyers have shown far more appetite since the pandemic. Torrent Pharmaceuticals’ acquisition of JB Chemicals reflects that trend. So does Mankind Pharma’s purchase of BSV. Strategic buyers typically seek long-term integration and broader product ranges.
Bal expects private equity to keep targeting domestic branded formulations. He cited the segment’s fragmentation and steady long-term growth. He also noted that domestic demand is less exposed to geopolitical uncertainty. In hospitals, he expects smaller deals and fresh investment in Tier II and III cities. He expects larger players to outgrow the market, gradually reducing fragmentation.
Outbound deals should also stay active, Bal said. Indian drugmakers are looking beyond generics towards speciality medicines, oncology, biologics, biosimilars and innovative drugs. Acquisitions can deliver such capabilities faster than internal development. Overseas deals may open markets in Europe and selected emerging economies. Localisation offers another driver, as countries favour domestic manufacturing and jobs.
Bal pointed to a valuation gap between Indian acquirers and overseas targets. Lower valuations abroad are creating attractive opportunities, he said. Cheaper prices alone, however, do not make a sound deal. Business quality, integration costs and regulation still matter.
Rothschild & Co. has advised on several major sector transactions. These include the JB Chemicals sale to Torrent and Medicover India’s announced sale to KKR. Consolidation offers clear routes to scale. Returns will depend on how well acquirers integrate what they buy.
