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India's Healthcare Soars Past Covid Funding Peak
26 Nov
Summary
- Healthcare sector fundraising surpasses Rs 62,432 crore, exceeding Covid-era highs.
- Market performance and larger M&A deals fuel the fundraising surge.
- FY26 fundraising has already exceeded Rs 72,440 crore, driven by pharma and hospitals.
India's healthcare and life sciences sector has reached an unprecedented fundraising milestone, surpassing Rs 62,432 crore and exceeding its Covid-era peak. This surge is largely attributed to strong market performance, a significant increase in equity capital market (ECM) activity within the pharmaceutical sector, and an uptick in mergers and acquisition (M&A) deals. The current fiscal year, FY26, has already witnessed fundraising exceeding Rs 72,440 crore.
The NSE Healthcare Index has demonstrated remarkable outperformance compared to the Nifty 50 across one, three, and five-year periods, with notable gains in MedTech, Hospitals, and Pharma subsectors. Average deal sizes in pharmaceuticals have nearly tripled, and in the hospitals sector, they have more than doubled. M&A transaction sizes have also quadrupled, signaling substantial investor confidence and larger deal-making appetite.
Looking ahead, the sector anticipates continued momentum in IPOs from contract development and manufacturing organizations (CDMOs), alongside ongoing M&A and buyout activities, especially within pharmaceuticals. Public market valuations are currently commanding higher enterprise value to EBITDA multiples than private markets, creating an arbitrage opportunity for companies looking to go public. Over the next three years, private equity and M&A investments are projected to exceed $5.3 billion, with an additional $8 billion expected in ECM activity.
