PE firm Quadria Capital set to deploy around $1 billion in Indian market

In various healthcare companies covering hospitals, pharmaceuticals, life sciences, medical devices, among others

Healthcare-focused private equity firm Quadria Capital, which recently sold its stake in Akums Drugs and Pharmaceuticals as part of the firm’s IPO, is set to deploy around $1 billion dollars for the Indian market in the next few years.

Sunil Thakur, partner, head, South Asia at Quadria Capital told Business Standard that healthcare sector is highly under penetrated and for the next few decades, we will see a significant amount of growth in order to meet the average infrastructure that is required for a country like India.

“So the scale of opportunity is so huge. Also the next few years will see a lot of consolidation in this space as the market is fragmented,” he added.

Thakur further said that they intend to deploy around $1 billion in India into various healthcare companies, covering hospitals, pharmaceuticals, lifesciences, medical devices among others. It currently has $1 billion asset under management (AUM) in India and globally has around $3.3 – 4 billion.

Quadria Capital recently sold 10 per cent stake in Akums Drugs and Pharmaceuticals through the firm’s IPO. Thakur said they made 3-time returns on their investment made in 2019. Quadria continues to hold 5 per cent in Akums after the IPO.

Last August, it sold its entire 20 per cent stake in Ahmedabad-based biopharma company Concord Biotech where it had invested in 2016.

Thakur feels that the healthcare sector would attract $250 billion over the next few years as India ramps up its infrastructure to the level of global average.

“Approximately, 70 per cent of this will come from the private sector. For every dollar spent on healthcare, one can make about 3-4 times returns on that,” he said.

While consolidation is happening in urban centers, tier-1 cities, more bed capacity is needed in tier-2, smaller cities, Thakur felt.

“We are also interested in hospital assets outside of the tier-1 cities as there is more growth potential beyond the top cities,” he said.

Quadria thinks that any hospital chain that has a deep regional approach – a cluster based approach - is the one to go after.

Within the healthcare space, Quadria Capital is interested in healthcare services, hospitals, diagnostics apart from pharma, lifesciences, medical devices companies.

It also wants to focus on single specialty healthcare companies like it invested $102 million in India's largest dialysis chain NephroPlus, picking up a minority stake in the company. Similarly, it made 4.2-time gross cash on cash returns from its exit in Asian Institute of Gastroenterology (AIG) Hospitals in April 2022.