New Delhi, Jan 16
India's healthcare sector, which has delivered a resilient performance in Q2FY26, is expected to sustain the momentum over the remainder of FY26, said a report on Thursday.
The report by EY-Parthenon, the sector remained strong in Q2FY26 with rising demand for high-end clinical specialties, steady capacity expansion by hospital chains, and strong consolidation in diagnostics.
The sector will sustain the momentum with 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, the report said.
Mergers and acquisitions activity remained robust during the last quarter.
In Q2FY26, the healthcare sector saw more than Rs 10,000 crore worth of announced transactions across hospitals, diagnostics, and specialty care. This included buyouts, minority investments, and cross-border acquisitions.
Healthcare assets continue to command premium multiples, particularly in diagnostics and high-growth specialty segments.
Notably, the average revenue per occupied bed (ARPOB) across leading hospital networks rose by 10-16 per cent year-on-year. Large hospital chains also continued to expand aggressively.
"Q2FY26 underscores the structural strength of India's healthcare sector. What stands out is the sustained shift toward high-acuity specialties such as oncology, cardiology, and neurology, reflected in rising occupancy levels and double-digit ARPOB growth across leading hospital chains," said Kaivaan Movdawalla, National Healthcare Leader, EY Parthenon India.
"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," Movdawalla added.
While leading hospital chains plan to add over 18,000 beds over the next three to five years, diagnostic companies reported 10-22 per cent year-on-year revenue growth in Q2FY26.
Growth was driven by rising volumes in Tier 3 and Tier 4 cities, with rapid expansion of B2C channels and increased demand for high-complexity testing.
Several diagnostics players also reported EBITDA margins in the range of 25-35 per cent, supported by operating leverage and network optimisation, the report said.
- IANS
Reader Comments
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.