Reports

India’s Healthcare M&A Activity Exceeds Rs 10,000 Crore in Q2 FY26, Led by Diagnostics and Specialty Care

EY forecasts that the momentum in healthcare deals will persist through the remainder of FY26, supported by rising utilisation, ongoing capacity expansion and strong investor confidence.

• By Newsdesk
• New Delhi
• Jan 15, 2026

Reports

India’s healthcare industry continued to attract significant investor capital in the second quarter of FY26, with mergers and acquisitions surpassing the ₹10,000 crore mark, according to a new sector report by EY-Parthenon India. The strong deal flow highlights sustained interest from private equity and strategic buyers in hospitals, diagnostics networks and specialised care platforms. 

The report found that hospitals, diagnostic chains and niche specialty care providers accounted for a steady stream of buyouts, minority stakes and cross-border acquisitions during the quarter. Investors showed a clear preference for businesses with scalable regional footprints, deep clinical capabilities and technology-driven delivery models. 

Valuations across healthcare assets remained robust, with leading listed companies trading at enterprise value/EBITDA multiples ranging from the mid-teens to more than 30 times - a signal of confidence in the sector’s long-term growth prospects. 

Hospital operators reported healthy performance metrics, including a 10–16 per cent year-on-year rise in average revenue per occupied bed, driven by disciplined pricing and a shift towards higher-acuity procedures. Major hospital chains have outlined plans to expand capacity by more than 18,000 beds over the next three to five years through a blend of greenfield projects and strategic acquisitions. 

EY-Parthenon India’s National Healthcare Leader, Kaivaan Movdawalla, noted that demand for specialised services — particularly in oncology, cardiology and neurology - remains a key growth driver, supported by rising occupancy and double-digit revenue growth. He also highlighted a trend of diagnostics companies investing heavily in advanced technologies such as genomics, oncology and AI-enabled testing. 

The diagnostics sector outperformed overall, with leading chains reporting year-on-year revenue growth between 10 and 22 per cent in Q2, fuelled by rising demand in tier-3 and tier-4 cities, expansion of direct-to-consumer channels and increased uptake of complex testing services. Several players delivered strong profitability, with EBITDA margins in the 25–35 per cent range. 

Investors also showed a growing appetite for integrated healthcare models and digitally enabled care platforms, particularly those expanding into emerging markets beyond major urban centres. Within diagnostics, the focus has shifted toward higher-value molecular and specialised tests, while preventive health and wellness programmes contribute a meaningful share of revenue for some firms. 

Multi-specialty hospitals reported robust year-on-year revenue growth of 9–28 per cent, underpinned by higher occupancy, favourable case mix and demand for complex treatments. Mature facilities maintained average occupancy levels between 54 and 77 per cent, and several operators are leveraging digital health tools and international patient segments to drive incremental gains. 

Looking ahead, EY forecasts that the momentum in healthcare deals will persist through the remainder of FY26, supported by rising utilisation, ongoing capacity expansion and strong investor confidence. Although new facilities may face near-term margin pressures, the report underscores robust medium-term fundamentals backed by favourable demographics, broader insurance coverage and growing demand for specialised care services.