Healthcare Sector Sees Strong Growth In Q2, Revenue Up 17.6%

New Delhi: The Healthcare sector in India grew strongly in Q2 of FY25, with revenue increasing by 17.6 per cent year on year (YoY), according to a report.

The report by Axis Securities showed that the healthcare sector also grew strongly by 10.4 per cent in quarter on quarter (QoQ).

Hospital occupancy rates, which rose by 340 basis points (bps) YoY and 470 bps QoQ were a key driver behind the growth.

Further, insurance payers contributed 33 per cent of total revenues in the hospital segment -- marking a 23 per cent YoY and 12 per cent QoQ growth.

However, the insurance penetration continues to remain low, the report said. It also offers room for expansion as awareness and purchasing power increase.

The report noted that cancer and cardiac care continue to drive double-digit growth. This, in addition to rising occupancy rates and Average Revenue Per Occupied Bed (ARPOB), is expected to sustain future growth in the healthcare sector, it added.

The report also recorded strong growth in the Indian pharma sector in Q2 FY25.

Major pharmaceutical companies in India reported a 10 per cent YoY growth in Q2 of FY25. This has been driven by impressive performance in North America and the domestic market. The Indian Pharmaceutical Market (IPM) grew by 8 per cent YoY, with chronic therapies seeing a 9 per cent increase. However, acute therapies experienced a modest 4 per cent growth due to a weaker season.

The report highlighted that the pharmaceutical sector under coverage recorded a 10.2 per cent YoY and 1.7 per cent QoQ growth, led by a 10.8 per cent YoY increase in North America and a 9.8 per cent YoY rise in the Indian business.

The outlook for the pharmaceutical sector remains positive over the next three years, with a promising pipeline in biosimilars, GLP-1 (glucagon-like peptide-1), and peptides, all of which are important in treating diabetes and other conditions.