Leading chains plan Rs 40K crore infra revival to close capacity gap over next 3-5 years
India's leading hospital chains are undertaking aggressive expansion plans over the next 3–5 years to bridge the widening demand-supply gap in the country's healthcare infrastructure.
Cumulatively, over 34,000 new beds are expected to be added by the private sector by FY29, according to industry estimates, entailing an investment of around Rs 40,000 crore.
Geographically, the expansion is heavily concentrated in North and South India, accounting for roughly 46 per cent and 30 per cent of the new capacity respectively, followed by West India at 13 per cent and the East and Central regions at 11 per cent.
A significant 38-40 per cent of this new capacity, equating to around 14,000 beds, is targeted towards Tier-2 and Tier-3 cities, indicating a broadening reach beyond the major metropolitan areas.
This comes amid a steady rise in healthcare demand driven by growing urbanisation, increased lifestyle-related ailments, and higher health awareness post-pandemic.
The private sector currently accounts for 60–65 per cent of hospital beds in India.
With public health infrastructure struggling to keep pace, private providers are stepping in to fill the void, announcing sizable capacity expansion plans to tap into this unmet demand.
According to industry estimates, the expansion will entail a capital outlay of over Rs 40,000 crore, a mix of greenfield, brownfield, and acquisition-led growth, backed by internal accruals, existing cash reserves, and incremental debt.
Apollo Hospitals, one of the largest private healthcare providers in India, is rolling out a two-phase expansion to add 3,512 beds -- a 34.5 per cent increase from its current capacity of 10,169 beds.
The total investment earmarked is Rs 6,100 crore. Phase 1 expected by FY26 will lead to the addition of 1,737 beds in Pune, Kolkata, Hyderabad, and Gurgaon at an investment of Rs 2,880 crore.
Phase 2 which will commence from FY26–FY29 will add 1,775 beds in Chennai, Varanasi, Mumbai, and Lucknow with Rs 3,220 crore investment.
“We are focused on expanding our presence and enhancing specialised centres of excellence across key locations,” said Suneeta Reddy, Managing Director, Apollo Hospitals.
“Better asset utilisation in existing facilities, volume growth, and a combination of high-end tertiary care and congo specialties will drive revenue, ARPOB and EBITDA growth.”
Apollo's expansion is largely focused on metropolitan and Tier-1 cities, leveraging its brand recall and integrated care ecosystem.
The group is also open to selective Tier-2 expansion, particularly where it has demonstrated strong ROCE (Return on Capital Employed).
Max Healthcare is planning to increase its bed capacity by 76 per cent by FY28, adding approximately 3,700 beds to its existing base of 5,036 beds as of Q3 FY25.
The planned capex stands at Rs 5,000 crore for FY26–FY28. About 76 per cent of the new capacity will be in metro cities, while the remainder will cater to Tier-2 cities. Additionally, Max has land parcels with the potential to add over 4,000 beds post-FY28, though formal plans for these are still under development.
“We have outlined an estimated capital outflow of Rs 5,000 crore to be incurred over the next three years,” stated Abhay Soi, Chairman and Managing Director, Max Healthcare.
“About 76 per cent of the new capacity will come up in metro cities, with the rest in Tier-2 locations."
Gurgaon's Artemis Medicare is set to more than double its current bed strength of over 800, targeting a total of over 2,000 beds in the next five years.
The expansion will focus on Delhi-NCR and select Tier-2 cities in northern India.
The company has already raised Rs 330 crore from the International Finance Corporation (IFC) and is planning projects that will bring in 800–1,000 new beds, including a over 300 bedded hospital in Raipur.
“This growth will fill healthcare gaps in large northern cities, reduce patient load at urban hospitals, and increase access in underserved regions,” said Ashutosh Jha, Chief-Strategy, M&A, Investor Relations and Organisation Growth, Artemis Hospitals.
Mumbai-based Jupiter Lifeline Hospitals is investing Rs 1,350 crore to build three greenfield hospitals in Western India, adding 1,300 beds -- effectively doubling its current capacity.
Ankit Thakker, Executive Director and CEO, Jupiter Lifeline Hospitals said, “Our focus remains on Tier-1 cities in Western India, where demand for advanced healthcare is growing rapidly.”
According to credit rating agency ICRA the addition of 34,000 new beds by FY29 represents a 2.3-2.5 per cent increase in the country's private hospital bed base, necessitating a capital expenditure exceeding Rs 40,000 crore.
This investment is expected to be financed through a combination of internal accruals, existing cash reserves, and incremental debt, supporting a diverse range of expansion strategies including greenfield projects, brownfield developments, and strategic acquisitions.
Feature Presentation: Rajesh Alva/Rediff
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