Eye care chain ASG Hospital Pvt. Ltd on Wednesday said it has raised Rs 1,500 crore ($188 million) in a round led by new investors General Atlantic and Kedaara Capital.
As part of the transaction, Investcorp will exit while another existing investor, Foundation Holdings will stay put.
This is the largest private equity funding in India's eye care industry after the Rs 1,050 crore raised by Dr Agarwal’s Health Care Ltd, earlier in May.
ASG Hospital will use the fresh capital to fuel its expansion plans, it said in a statement.
"This investment further reinforces ASG Eye Hospitals’ success at attracting talented investors," said Arun Singhvi, chairman and managing director and Shilpi Gang, co-founder, ASG Hospital, in the statement.
Aakash Sachdev, co-founder and managing director, Foundation Holdings, said that ASG Hospital plans to establish a network of over 200 hospitals within the next 36 months.
"With the imminent planned acquisition in South India and our high-quality M&A pipeline of regional players, we look forward to partner with two highly regarded and forward-thinking investors at this transformational inflection point in the history of ASG Eye Hospitals," added Sachdev.
ASG Hospital was selected by the committee of creditors (CoC) of Vasan Healthcare earlier this year to acquire the once haloed Chennai-based eye care chain that has a strong presence in the southern region. The decision is awaiting final approval from the National Company Law Tribunal (NCLT).
Earlier in May, in an interaction with VCCircle, Sachdev also said that ASG Hospital is ramping up its inorganic growth strategy and was is in different stages of discussions with 15 companies for acquisitions.
ASG Hospital, which was founded in 2005 by Arun Singhvi and Shashank Gang, raised its first external funding from Sequoia Capital India in 2012 and later raised funding from IDFC Alternatives (which was acquired by Investcorp) and Foundation Holdings.
The company's net sales in fiscal 2020-21 (FY21) grew slightly to Rs 143 crore from Rs 140 crore in the previous financial year, according to VCCEdge, the data and intelligence platform of VCCircle, as most of the eye care chains were affected by covid-19. Sachdev had said that ASG Hospital’s net sales doubled in the recently ended fiscal year in March 2022 and it is expected to clock around Rs 450 crore in the ongoing financial year.
Shantanu Rastogi, managing director at General Atlantic, said that ASG Eye Hospitals has already had a positive impact on millions of lives and in the process, the team has demonstrated its ability to deliver strong performance at scale. Till January, General Atlantic had invested $4.5 billion in India. It has several unicorns in its portfolio, including edtech firms Byju’s and Unacademy, Acko General Insurance, broking platform NoBroker and the National Stock Exchange. In 2020, it also picked up stakes in Jio Platforms Ltd and Reliance Retail Ventures.
Nishant Sharma, CIO and managing partner of Kedaara Capital said that the homegrown private equity firm with its operational expertise will help bolster the company's next phase of growth. The private equity firm was founded by Manish Kejriwal, former India head of Singapore state investment fund Temasek, and Sunish Sharma and Nishant Sharma—who were managing director and principal, respectively, at global private equity firm General Atlantic in India. Its recent investments include in GAVS Technologies and online beauty products marketplace Purplle.
This is second private equity funding in the eye care industry in India in less than two months, underlining sustained investor interest in the segment. In May, Dr Agarwal’s Health Care Ltd raised Rs 1,050 crore from new investor TPG Growth and existing investor Temasek. The transaction also provided an exit to ADV Partners.
The eye care market is expected to grow at the CAGR of 7.3%, valuing it at $2 billion by 2022, based upon this increasing burden of eye diseases and moderate growth in technological advancements.
Other private equity backed players in the eye care space include New Delhi-based chain Centre for Sight and Infigo Life Sciences Pvt. Ltd.