VC Investor HealthQuad Exits Specialty Hospital Chain AINU, Sells Stakes for INR 600 Cr

Reportedly, the Quadria Capital-backed VC fund booked a 4x return on its investment.

Healthcare-focused venture capital (VC) fund HealthQuad has exited from the Asian Institute of Nephrology and Urology (AINU), India's leading single-specialty hospital network dedicated to urology and nephrology care.

Founded in 2013 by Dr C Mallikarjuna and Dr P C Reddy, AINU offers comprehensive clinical services in urology and nephrology. Currently, it operates 500 beds across its seven hospitals. It has served over 400,000 patients and conducted 50,000 procedures.

In 2016, HealthQuad invested in AINU to help the company build a pan-India single specialty hospital chain focused on nephrology and urology.

The exit was the result of AINU’s acquisition by Asian Healthcare Holdings, a single-specialty healthcare platform, backed by TPG Growth and GIC, for INR 600 Cr last year.

Reportedly, the Quadria Capital-backed VC fund booked a 4x return on its investment. This also marks the fourth exit for HealthQuad’s maiden VC fund of INR 75 Cr, raised in 2016.

Sharing thoughts, Pinak Shrikhande, MD, HealthQuad, said, "HealthQuad is actively pursuing deals across health-tech, biopharma, medtech, and healthcare delivery."

The Investment Deal

HealthQuad is currently investing out of its second fund, a significantly larger one totaling $162 million. Approximately 65-70% of this fund has already been invested across 12 different ventures.

The firm's investments include companies such as HealthifyMe, Medikabazaar, AINU, THB, Impact Guru, Ekincare, Qure.ai and Stanplus.

Looking ahead, the latest fund is expected to prioritize investments in various sectors including cell and gene therapy, vaccines, biosimilars, medtech, medical equipment, single specialty assets, and contract research organizations, expanding upon its existing areas of interest.

“Over the next 12 to 18 months, we will exit Fund I completely,” MD Shrikhande added.

According to various reports, the VC fund is currently in the process of raising a third fund, aiming for a targeted corpus of $300 million.

“We are on the right side of the investment cycle as far as healthcare delivery is concerned. We have done our part in the growth of AINU and now it is time for a larger, more strategic player to look at this, to take it beyond what we had done,” noted Shrikhande.

Starting from a single facility in Hyderabad, AINU has scaled up to a total of seven facilities across Hyderabad, Chennai, Siliguri, and Vishakhapatnam, increasing bed capacity five times, while its patient volume has increased by 200%

Their services include diagnosing and treating stone disease, urology cancers, prostate diseases, reconstructive urology surgery, laparoscopic urology, and andrology.

In September, Asia Healthcare Holdings (AHH), a healthcare delivery platform, acquired a majority stake in AINU. The acquisition involves a substantial investment of INR 600 Cr in AINU through primary and secondary investments.

Taking this step consolidates AHH's position as India's largest single-specialty healthcare delivery platform and across the broader Asian subcontinent, said the hospital.

In 2022, there were approximately 1.89 Cr nephrology and urology procedures performed in India, and this specialty is projected to grow by 8-9% CAGR during the next five years.

India currently boasts a pool of 6,000 qualified urologists and 3,500 nephrologists, with around 350 urologists and 250 nephrologists graduating each year, emphasizing the increasing demand for specialized care in these fields.