After over 2 years of subdued performance now hospital sector is on recovery path: ICRA

The Indian hospital sector is heading towards better days after more than two years of subdued performance, as per ICRA.

Adverse effect of the rollout of the goods and services tax on profitability, exacting regulatory moves taken by different states, including putting confinements on procedure rates, charging penalties and setting operational limitations on erring hospitals were other measures that affected the sector.

The performance was also affected because of the start-up expenses of new hospitals owning to significant capex done by the substances in the sector and the long gestation time frame required for the new facilities to ramp up.

"In accordance with our desires, the performance of the players in the sector has likely bottomed out, subsequent to battling for over two years," said Information and Credit Rating Agency (ICRA) Corporate Ratings-Assistant Vice-President Kapil Banga.

In the FY-2018-19, incomes of the companies in ICRA's sample set grew 10 per cent to Rs. 15,891 crores (US$ 2208.84 million) contrasted with incomes of Rs 14,475 crore (US$ 2012.02 million) in the previous fiscal year.

And the sample set included Apollo Hospitals Enterprise, Fortis Healthcare, Narayana Hrudalaya, Healthcare Global Enterprises, Max India and Shalby.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.