Indian Diagnostics Sector
Projected to reach ~$32 Billion by CY29
Indian Diagnostic Market is set to grow 2X over the next five years.
Diagnostics form an integral part of the healthcare value chain alongside hospitals and pharmaceuticals, comprising approximately 4.4% of the overall Indian healthcare industry. The market is projected to reach $31.92 billion by CY29, up from its current size of $16.23 billion in CY23, with a robust Compound Annual Growth Rate (CAGR) of 12%.
Factors propelling the growth of the Sector?
The meteoric rise can be attributed to several factors, including the surge of multiple factors alongside the Covid 19 pandemic. These factors include the rise in customer preference for convenience, rapid expansion in Tier II and III cities, greater health consciousness, and a highly underpenetrated market compared to developed counterparts.
Current State of the Indian Market?
The Indian market is highly fragmented, with large players occupying approximately 6-7% of the overall market chain, followed by regional players capturing another 11%. The majority of the market share is held by local independent labs, accounting for about 46%, while the remaining share is with hospital-integrated diagnostic labs.
Evolving changes that are transforming the Industry?
The advent of new technologies such as online diagnostic consultation, digital imaging interpretation, and integration of technology across procurement and supply chain processes is shaping the future roadmap of the market. Looking ahead, we anticipate the discovery of additional tests to be added to the range of offerings, offering the convenience of monitoring from the comfort of home.
Transaction Outlook
The market has witnessed significant activity in the past two months, with two large players acquiring for market expansion and venturing into new service lines. The surge of M&A activity, particularly with regional players consolidating and national players seeking to acquire them, suggests a potential increase in consolidation volume. Private equity transactions have also seen a rise since 2021, with new-age chains attracting capital.
Overall, the outlook for the sector remains positive and poised to align with the healthcare industry.
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