India's Healthcare Deals Surge Past Rs 10,000 Crore in Q2 FY26

According to the EY-Parthenon India Q2FY26 Healthcare Sector Update, this resilient performance was supported by rising demand for high-end clinical specialities and steady capacity expansion by hospital chains.

The quarter saw a robust volume of mergers and acquisitions, including buyouts and cross-border transactions across the hospital, diagnostics, and speciality care segments.

Large hospital networks reported a 10-16 per cent year-on-year increase in average revenue per occupied bed. This growth was attributed to pricing discipline and a notable shift toward higher-acuity procedures.

Major hospital chains plan to add more than 18,000 beds over the next three to five years through a combination of greenfield projects and selective acquisitions. Multi-speciality hospitals saw revenue growth of 9-28 per cent, driven by complex specialities such as cardiology, oncology, and neurology.

Kaivaan Movdawalla, National Healthcare Leader, EY Parthenon India, said, "Q2FY26 underscores the structural strength of India's healthcare sector. What stands out is the sustained shift toward high-acuity specialities such as oncology, cardiology and neurology, reflected in rising occupancy levels and double-digit ARPOB growth across leading hospital chains. At the same time, diagnostics players are moving decisively up the value chain, with accelerated investments in genomics, oncology and AI-led testing platforms. This combination of clinical depth, asset expansion and technology adoption positions the sector well for durable, long-term growth."

The diagnostics segment outperformed, with leading chains reporting 10-22 per cent year-on-year revenue growth. Growth in this area was driven by rising volumes in Tier III and Tier IV cities and increased demand for high-complexity testing. Several players reported EBITDA margins of 25-35 per cent, supported by operating leverage and network optimisation.

Amit Gupta, Partner - Healthcare and Life Sciences Investment Banking, EY said, "Investor interest in healthcare remains robust, reflected in sustained buyouts, strategic acquisitions and private equity investments across hospitals, diagnostics and speciality care in Q2FY26.

Investors are prioritising platforms with scalable regional footprints, robust unit economics and clear expansion pathways, especially into Tier 2 and Tier 3 markets. Integrated healthcare models and technology-enabled assets are increasingly favoured and are commanding premium valuations."

EY expects sector momentum to sustain over the remainder of FY26, supported by rising healthcare utilisation, capacity additions coming on stream and continued investor interest.

While near-term margin pressures may persist for newly commissioned assets, medium-term fundamentals remain strong, underpinned by favourable demographics, expanding insurance coverage and increasing demand for specialised care.

- ANI