INDIA – Bupa, an international healthcare company based in London, is looking to make additional investments in India as part of its efforts to strengthen its footprint in the subcontinent.
According to the online platform In42, the Indian healthcare market, which was valued at US$86 billion in 2016, is now projected to reach US$367 billion by 2023 and US$638 billion by 2025.
In an official note, the Chief Executive Officer of Bupa, Iñaki Ereño, said: “We want to be big in India as the country is going through a major healthcare revolution. We intend to invest as much as possible as a strategic partner to develop India’s healthcare ecosystem.”
To help the company expand and grow in India, Bupa intends to leverage digital technology to improve access to healthcare services, enhance operational efficiency, and facilitate the adoption of telemedicine.
Bupa also identified affordable healthcare solutions and social healthcare offerings as key growth areas as the international healthcare company explores market opportunities for business growth.
“As healthcare costs rise, insurance becomes increasingly crucial in providing financial protection and ensuring access to quality care,” underlined Iñaki Ereño.
The London-based healthcare provider’s expansion plan comes as India’s health insurance market is expected to reach US$198.45 billion by 2027.
What’s more, rumors are circulating in the investment community that executives with Bupa are exploring strategic spending strategies that could include raising a stake in Niva Bupa Health Insurance Limited.
Speaking on speculations about this investment, Managing Director of Niva Bupa Health Insurance Limited, Krishnan Ramachandran, said: “It is not at a stage where I can offer a comment.”
The Niva Bupa Health Insurance, formerly Max Bupa Health Insurance, covers almost all the legitimate costs borne by the insured during hospitalization. Moreover, these health plans come with a wide sum of insured options.
Niva Bupa is a joint venture between the Bupa Group and Fettle Tone LLP, an affiliate of Indian private equity firm True North Fund VI LLP.
It was originally a joint venture between two promoter entities – Max India Limited and Bupa Singapore Holdings Pte. Ltd. Shares were transferred to True North after Max’s exit in December 2019.
It is speculated that Bupa is in talks with True North to purchase additional shares in the Indian-based insurance company, adding up to 20% to the 44% stake it already owned.
Niva Bupa is currently valued at about Rs. 12,000 crores (nearly US$1.5 billion) before the proposed investment.
Rumors of the possible acquisition deal come as Niva Bupa aims to enhance market leadership in the retail segment by charging the right premium for undertaking an appropriate level of risk, having drawn capabilities from Bupa.
Commenting on behalf of the company, Krishnan Ramachandran disclosed: “From my standpoint, what I can say, whether it’s Bupa or True North. In terms of capital, for the right reasons – growth and solvency – is that it is forthcoming from shareholders.”
Ramachandran emphasized that there is a need for more players in the Indian health insurance space to increase penetration while noting that affordability of healthcare is crucial for the growth of the insurance sector.
“The government has proposed amendments to the insurance laws, including granting insurers a composite license to allow them to sell different products in different segments of the sector,” stated Ramachandran.
He underscored the proposed composite license backed by the Indian Government is one of the doable mechanisms to accelerate the attainment of health insurance for all Indians by 2047.
“With 10 million customers already onboard and recognizing the potential for growth and the untapped market opportunities, Niva Bupa is focused on the retail insurance sector in India,” added Ramachandran.
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