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“Private Equity firms scouting Indian hinterland for Healthcare investment opportunities”

Diagnostic Services, Medical Devices, Hospital Chains and Wellness Products to attract the most investments, a survey of PE & VC investors by research firm Venture Intelligence reveals.

Private Equity and Venture Capital investors, who have invested over $2 billion into Healthcare & Life Sciences (HLS) companies in India over the last five years, are keen to step up the pace of investments in this industry. Over 42% of PE & VC investors surveyed by Venture Intelligence, a leading research firm focused on Private Equity and M&A deal activity, felt there was a strong opportunity to tap the market for healthcare services in semi-urban and rural areas. The investors also identified Diagnostic Services, Medical Devices / Equipment, Hospital Chains and Wellness Products and Services as their favorite sectors for investments within the HLS industry. The detailed results of the poll will feature in the Venture Intelligence “Private Equity Pulse on Healthcare & Life Sciences” report to be published next month.

“Given the fragmented nature of both the hospitals and pharmaceuticals sectors, investors also see potential for tapping into consolidation opportunities in partnership with growth-oriented entrepreneurs,” points out Mr. Arun Natarajan, CEO of Venture Intelligence. “The HLS industry did not participate significantly in the bull phase of the Indian public and private equity markets during 2005-2007. With about 20% of new PE/VC fund corpuses expected to be invested into HLS going forward, a revival is clearly on the cards,” he adds.

Despite the overall optimism, PE/VC firms also have some specific concerns relating to investments in the HLS industry. The Venture Intelligence poll lists long gestation periods, scalability and talent shortage as among the top concerns for investors when it comes to the healthcare sector. In the Life Sciences segment, investors’ concerns are focused on the high risk of failure (especially in new drug R&D), stiff competition from inside and outside India, as well as patent-related issues. Lack of clarity in regulations and corporate governance standards were listed as common concerns across the industry.

Apart from the survey results, the “PE Pulse on HLS” report will feature articles by top PE/VC funds, advisory firms and leading corporate law firms. For the convenience of entrepreneurs, the report will also provide a listing of Private Equity and Venture Capital funds keen to invest in this industry. A directory of investment advisory firms, who provide value-added intermediation services with a special focus on HLS, will also be included.

For more information, please contact Venture Intelligence at info@ventureintelligence.in or +91-44-45534303.

About Venture Intelligence

Venture Intelligence, a division of Chennai, India-based TSJ Media Pvt. Ltd., is the leading source of data and analysis on Private Equity, Venture Capital and M&A deals in India. Our products include Databases, Newsletters and Reports - all focused on tracking deal activity in India. Our subscribers include top executives at Private Equity and Venture Capital Firms, Investment Banks, Limited Partners, Law Firms, HR Services Firms and Consulting Firms in India, USA, and the Asia-Pacific. For more information, visit http://www.ventureintelligence.in.

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