In its recent report, Equirus notes that the NSE Healthcare Index has outperformed the Nifty 50 over 1, 3, and 5-year periods. The report highlights broad-based outperformance across subsectors such as MedTech, Hospitals, and Pharma.
For example, over three years, MedTech returned 221%, Hospitals 183%, and Pharma 73%, compared to 48% by the Nifty 50.
Equirus attributed the surge in activity to strong market performance, which further enabled record fundraising. The current fiscal year (FY26) has already seen fundraising cross Rs 72,440 crore, led by equity capital market (ECM) activity in Pharma and buyouts in the Hospitals segment.
ETMarkets.comSiddharth Iyer, Director and Sector Lead – Lifesciences and Healthcare at Equirus Capital, noted, “The current fiscal year has already seen fundraising cross Rs 72,440 crore led by ECM in Pharma and Buyouts in Hospitals. Apart from a significant uptick in activity across all sub-sectors, we have seen the average deal size almost triple from Rs 700 crore in the pharma sector to Rs 2,100 crore and, from Rs 300 crore in the hospitals sector to Rs 850 crore.”
Equirus also observed that M&A transaction sizes have sharply increased, with average deal sizes more than quadrupling from Rs 700 crore to Rs 3,000 crore. Pharma accounted for Rs 32,000 crore of ECM activity in FY26, representing nearly 63% of the Rs 51,000 crore raised through this route.Looking ahead, Equirus expects IPOs from contract development and manufacturing organisations (CDMOs) and continued momentum in M&A, buyouts, and QIP activity, particularly in Pharma. It also noted that buyouts are increasingly outpacing private trades, driven by asset scale and valuation arbitrage.The report outlines five trends that are expected to shape 2026:
PE funds are building healthcare delivery platforms as the market remains fragmented.
1.Regional consolidation by diagnostic chains.
2.Increased PE interest in single-specialty care and MedTech.
3.Rising valuations due to scarcity premium in MedTech.
4.Hospitals shifting toward asset-light models.
Highlighting public market dynamics, Equirus stated, “Public markets across sub-sectors such as Active pharma ingredients, Formulations, CDMOs, Pan India hospitals, Regional hospitals and Diagnostics providers are all commanding significantly higher enterprise value to EBITDA multiples than private market valuations. This is driving equity capital markets issuance as there is a clear arbitrage available for IPO’able companies.”
In terms of investment outlook, Equirus forecasts that private equity and M&A investments in the healthcare and life sciences sector will exceed $5.3 billion over the next three years. Additionally, it anticipates $8 billion in ECM activity in the sector, with USD 4.5 billion expected to be attracted in healthcare and MedTech alone.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
