Private equity in India's hospitals flowed mainly to west and south, study finds
A study of 70 PE-backed health deals over 18 years shows capital clustering in urban southern and western states while rural regions were largely bypassed.
Private equity money in India's healthcare sector has concentrated heavily in a handful of urban states, leaving much of the rural map untouched. A study by researchers at Brown University's School of Public Health and the Johns Hopkins Bloomberg School of Public Health tracked 70 private equity-backed acquisitions between January 2007 and May 2025. More than 73% of that capital went into 45 hospital groups, most of them multispecialty chains.
The deal flow was not evenly spread. Karnataka led with 13 deals, while Maharashtra and Telangana recorded 10 each. Gujarat logged six, and Kerala and Haryana five apiece. Northern and eastern states drew little or no investment, a gap that matters for a country where access to hospital care is uneven. Among outpatient providers, eye care and fertility or reproductive services were the most common targets.
Timing followed the global pattern. Activity picked up after 2020 and peaked in 2023 with 18 deals. The authors link that surge to the pandemic-era environment of low interest rates and abundant capital, which made financing cheap while healthcare's steady revenues looked more resilient than many other sectors.
Foreign funds dominated the financing. Of the acquisitions, 47, or 67.1%, were backed solely by overseas private equity firms, including investors based in the US, Singapore and Mauritius. Eighteen deals were funded exclusively by Indian investors. Four hospital groups accounted for roughly a third of all deals, among them Manipal Health Enterprises, Health Care Global Enterprises, CARE Hospitals and ASG Eye Hospitals.
For investors, the exit picture is instructive. Of the 25 exits the study observed, secondary sales to other private equity firms were the most common route, at 64%. Exited investments were held for an average of 5.1 years, and hospital platforms made up more than half of those exits. Still, 45 hospital groups, or 64.3%, remain under their original private equity owners, suggesting many backers are in for the long haul.
The study also found that several platform deals began as minority stakes, with ownership rising in stages. The researchers describe this step-by-step approach as more cautious, a pattern they say is also seen in other BRICS markets. For policymakers, the message is that capital is following profitable urban networks, and closing the rural gap will likely require deliberate incentives rather than market forces alone. The full study was published in BMC Health Services Research. Read the original report at Times of India.