Multi-specialty hospital platform Marengo Asia Healthcare is exploring a rights issue and the possibility of roping in an external investor as it looks to expand bed capacity to 3,000 by the end of 2026, a top executive told ET.
The platform, which is backed by Samara Capital, Havells Family Investment Office and Godrej Family Investment Office, is in talks for the acquisition of two hospitals which have a combined capacity of 500 beds, said Abhishek Kabra, chairman of Marengo Asia Healthcare, and partner, Samara Capital.
“The focus would be on building a differentiated and scalable business,” Kabra said in an interview, adding Marengo has the ability to take the bed capacity to 500-750 through internal accruals, additional debt and rights issues.
“Beyond 2,500 beds is where we would be open to looking at an external investor also becoming a part of the story,” Kabra said. “There could be a possibility that if we are getting visibility of 5,000 beds in early 2026, we may want to go for an IPO (initial public offering) earlier than that. So we remain flexible.”
Along with 200-500 bed hospitals, Marengo is also exploring asset-light operations and management (O&M) contracts that will serve as feeders for its anchor assets in the geographic clusters it operates, according to Kabra.
Marengo began operations with the acquisition of the 480-bed CIMS Hospital in Ahmedabad in October 2021. So far, it has invested around ₹1,500 crore with equity and debt put together, and expanded capacity to 1,700 beds across five hospitals, of which three are company-owned.
It also acquired the 550-bed QRG Hospital in Faridabad in November 2021, and the 210-bed W Pratiksha Hospital in Gurugram in March 2023. It runs two more hospitals under O&M model in Bhuj, Gujarat, and Jodhpur, Rajasthan, with each having around 200 beds.
In FY24, Marengo posted a revenue of around ₹700 crore. “This year, we should get closer to ₹850 crore; we are operating at about 15% (EBITDA margin) levels today, which we believe will scale upwards of 20% in the next 12 to 18 months as occupancy levels increase,” he said.
