• Fortis Healthcare Ltd. is one of the largest private healthcare
companies in India.
• The company is having a network of 28 hospitals, satellite
centers and heart command centers with about 3300 beds
• It includes multispeciality as well as superspeciality centers
providing tertiary and quartenary healthcare to patients in
areas such as:
o Cardiac care
o Oncology and
o Mother and child care.
The company intends
growing in an aggressive
manner to have a Pan India
presence with bed strength
of 6000 through 40 hospitals
by the year 2012
Lower public expenditure
Public expenditure on health is lower than in other developing
countries and hence, healthcare industry is dominated by private
The government is also encouraging public private partnership
and promoting medical tourism. And also aiming to modernize
the healthcare system.
For these reasons, India’s healthcare industry is
anticipated to grow tremendously in the coming years.
More and more Indians are adopting sedentary
life style leading to:
Increased consumption of fast foods, alcohol.
Adulteration of food items
Increase in life expectancy leading to more older
population which is prone to degenerative
• Much of the India’s healthcare expenditure comes from private
• The top 33% income earners in India accounted for 75% of total
price expenditure on healthcare in 2004.
• But according to latest survey rising incomes are expending the
rich and middle income groups and they are expected to form
49% of total households in financial year 2010 as compared to
33% in 2004.
significant investment opportunities.
by an estimate to reach even half of chian’s current beds
per 1000 population India would need an additional 9,20,000
beds over the next 10 years.
Increased life expectancy and ageing population.
life expectancy which averaged 63.3 yrs in 2000-04 is expected
to increase to 66 yrs in 2006-10.
• The proportion of population aged 65 yrs and over in 2000 is also
on the rise and will increase by about 15% in 2010.
Shift to life style related diseases
• The shift in disease profiles from infectious to life style related
diseases is expected to raise expenditure per treatment
Particulars 2004 2005 2006 2007 2008 2009
34.9 40.4 45.7 52.1 56.0 60.9
Higher population and literacy.
• India has 2nd largest population in the world and it is estimated
that by 2050 we will be having largest population in the world.
This displays huge opportunity for health sector.
• There is huge urban shift in India of nearly 26%. Which greatly
increases the size of target market for the private players.
• Literacy rate in India has increased to 52% making the people
more aware and health conscious. So they are realizing the
importance of hospitals.
GLOBAL & TECHNOLOGICAL
Over burdened health infrastructure and high cost in the West.
• The healthcare system in Europe & US are under severe pressure,
particularly NHS in the UK. Which has a long list of patients waiting
for over a years. Same is the condition in US, further more there is
shortage of paramedical professionals. India
India’s low cost of medical care in quality service.
• India offers highly cost competitive medical treatment and
technological advancement. Which brings down the overall cost of
treatment, thus India has huge potential to emerge as a hub for
preventive health screening and treatment.
It can be said that Indian environment provides a very
good opportunity for private players in healthcare. Growing
population with much deeper pockets and low government
participation has lead to higher demands where people are
willing to pay even high cost for proper medical care.
PORTER’S FIVE FORCES ANALYSIS
The growing Indian economy, rise of middle class,
growing awareness of health and fitness are the main factors
which are increasing the demand for healthcare services in
India. Still India falls woefully short on various healthcare key
e.g. life expectancy is still low.
Indian hospital beds per 1000 population stands at a
little over 0.7, against world average of 3.96.
So, most of the rich patients are going to foreign
countries for their treatment. Which costs an accountable loss
to India’s healthcare industry.
Due to friendly government policy there is reduction in import
duties on medical equipment's, higher depreciation (40%), up
from 25%) on life saving medical equipment and number of
other tax incentives which in turn intensifying the competition
among global firms into the medical equipment market place.
Which eventually is beneficial for hospitals.
Low competition from public sectors.
Government spending on healthcare is estimated at only
about 0.87% of GDP as compare to US & UK who spend up to
7% of GDP on healthcare.
THREATS OF NEW ENTRANT’S
Encouraging government reforms.
• The government is expected to pitch about 15-20% of additional
investment in healthcare.
• Also the reformed government healthcare policies are trying to
attract both domestic as well as foreign investment.
• 100% FDI in healthcare industry without prior approval.
THREATS OF SUBSTITUTE’S
Alternative medicine is a type of diagnostic technique in
method of treatment whose theory develop from accepted
methods. It includes Ayurveda, Homeopathy, Osteopathy,
Physiotherapy and more.
The advantage of alternative medicines are that they are
often save and effective. But disadvantage is that they are not
tested for efficacy. Delay in seeking results is another common
OPPORTUNITIE’S & THREAT’S
India’s low cost and new high quality healthcare services has
promoted medical tourism. The medical tourism market in India is
estimated at $333 million in 2004 & is predicted to reach $ 2 billion
Huge market opportunity.
A growing population, rising income levels, changing pattern of
diseases, increasing demand for quality healthcare at affordable
prices is expending the target domestic market along with
• Slow adaptation of IT
Indian healthcare industry remained very slow in adaptation of
IT. Only few % of elite hospitals are using the well developed IT
infrastructure. Therefore there is an urgent requirement for
building of IT infrastructure to cope up with this problem.
Emergence of China.
China is emerging as new low cost & quality healthcare
destination for the individuals seeking medical care in wide range of
In conclusion it can be ascertained that consumer have very
little power in India due to huge amount of demand and also the
suppliers don’t have much power as there are quite a few
manufacturer of medical equipment’s. Even then due to huge
demand and medical tourism healthcare industry provides a
tremendous opportunity in India.