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Commelina Limited, an affiliate of Creador III LP (Creador), has invested Rs 275 crore ($42 million) for a minority stake in the North India-focused hospital chain Paras Healthcare Private Limited (Paras). This is Creador's 24th investment across the globe, while being the ninth fund support endeavour in India. The private equity firm focuses on long-term investments in growth-oriented businesses in South Asia and Southeast Asia.
Incorporated in 2006 by Dr Dharminder Nagar, Paras operates a chain of 5 hospitals, total of 730 beds, offering secondary and tertiary care services. Apart from establishing the first multi-specialty hospital in Gurgaon, Darbhanga and Patna, it also has two mother and child hospitals under the Paras Bliss brand in New Delhi and Panchkula, the company and the investor said in a statement.
The chain has demonstrated strong growth and profitability over the years with an asset light strategy of brownfield and greenfield hospitals. Paras continues to expand in Tier-I and Tier-II cities with a focus on providing affordable healthcare services to the middle-income segment of North India.
The Indian healthcare market is highly underserved with 9 beds per 10,000 population, as against a global average of 30 beds. The overall healthcare expenditure of $160 billion has increased at 17 per cent CAGR for the last 10 years and private players have become a larger part of the overall pie. North India, which has 40 per cent of India’s population, is characterised by the weakest hospital infrastructure and lowest doctor availability amongst all regions in India.
According to Dr Nagar, “Paras Healthcare was built on three tenets– affordability, accessibility and quality. Paras has always envisioned itself to be a contributor in the changing landscape of healthcare in North India and work on the existing healthcare divide where 70 per cent of the doctors and hospitals are located in metropolitan cities catering to only 30 per cent of the population. Today some of the oldest cities in North India have the weakest healthcare infrastructure. Each hospital of Paras aims at being a community player by empowering the common man, the middle class, with access to specialised care at locations that has limited or no specialised healthcare facilities. Our endeavours in Bihar illustrate our ideation. Paras Healthcare today is the largest healthcare provider delivering comprehensive multi super speciality care in Bihar and our hospital in Darbhanga is the only super speciality corporate hospital in the Mithila region. With Creador’s support, we aim to make our vision of envisaging a healthcare revolution in North India a reality.”
Anand Narayan, Managing Partner at Creador Advisors India LLP said, “Paras Healthcare is indeed a differentiator in healthcare that has the middle class as its target group. The hospital infrastructure and operations are all developed to provide the best healthcare services at affordable costs. In a landscape where 70 per cent of the healthcare costs are currently paid out of pocket, the vision and operational aspects of Paras are relevant. We are certain that this association shall be fundamental in the evolving landscape of Indian healthcare. Moreover, their presence in Bihar already elucidates their aim and execution capabilities of providing quality super speciality medical care even in the hinterlands of the country. We look forward to assisting Paras in their next phase of growth.”