Max Healthcare Expands Strongly in Delhi-NCR with Smart Growth Strategy

Max Healthcare is Set to Flourish in the Healthcare Industry

Image Credits: The Financial Express

Efforts

The hospital chain is expanding and focusing on growth in the Delhi-NCR region. The region is experiencing excellent growth in margins and ARPOB, and occupancy, which reflects the early days of Max Healthcare. The company is initiating efforts to leverage its performance in the rapidly growing healthcare sector. Max Healthcare will increase the bed count by FY28, considering the company’s maintenance of a net-debt-free balance sheet. Max Healthcare includes 5000 beds, an EBITDA margin north of 26% and Rs 9,000 crore in revenue. The company is a competitor to the healthcare giants in the market. Currently, Max Healthcare is sharpening the expansion of brownfield and implementation of its metro-centric strategy, including capital-light diagnostics. As this has sparked a profitable healthcare business to date in the country.

Challenges of Max Healthcare

The past years were challenging for the company as it was running low on assets and was struggling to grow without compromising its profit. Max initiated a smart move by acquiring infamous hospitals and helping them with required facilities, keeping the capital deal as an important factor of the agreement (contract). This strategy of Max built the Yatharth Hospital more efficiently and resembled.

Yatharth Hospitals

Yatharth hospital stayed grounded to its regional roots and strengthened its two clinics and four hospitals located in Delhi-NCR and UP. The limited occupied areas and designs are the strength of Yatharth hospitals. In FY25, the hospital earned Rs 880 crore in revenue, which is an approximate growth of 34% CAGR in the last three years. The operational beds were in heavy demand during this period. The occupancy increased by 61% and the average revenue per operational bed per day (ARPOB) went from Rs 23,500 in FY22 to Rs 30,829 in FY25. The pricing power was the highlight of the company’s growth. Yatharth also experienced a 26% growth in EBITDA margins in five years.

Brownfield

Max’s focus on brownfield growth elevated its presence in already potential infrastructure. Saket building is a double the area similar to Nanvati Mumbai and other locations. Max acquired Sahara in lucknow and Jaypee hospital in Noida, Alexis. These hospitals have potential to upscale in the healthcare market but was still not considered as one. Max enhanced their brand and operating model to help them rank in the competitive environment of healthcare industries. This strategy worked for many industries in the market.