Paras Healthcare Limited, a clinical specialty-led hospital platform with a 20-year operating history, has filed its Draft Red Herring Prospectus for an initial public offering. The company operates a network of eight hospitals with an aggregate bed capacity of 2,211 beds across five states and one union territory, focusing on tertiary and quaternary healthcare services.

About the Company

Headquartered in Gurugram, Haryana, Paras Healthcare delivers tertiary and quaternary healthcare services through a hub-and-spoke hospital network. The company’s clinical model is anchored by 1,084 doctors and 1,937 nurses as of 30-Jun-2026, including three Padma Shri awardees. Its operations are concentrated in key markets such as Gurugram, Patna, Panchkula, Srinagar, and Kanpur.

The company specializes in CONGOR specialties (Cardiac, Oncology, Neuro, Gastro, Orthopedics, and Renal Sciences), which contributed approximately 74.35% of revenue in Q1 FY2027. Paras Healthcare positions itself as one of the largest healthcare providers in North India, Bihar, and Jharkhand, holding first-mover advantages in several Tier-2 and Tier-3 cities. The network is equipped with advanced technology including biplane cath labs, LINACs, surgical robots, and PET-CT scanners.

Financial Performance

The company demonstrated significant revenue growth over the last two fiscal years, with revenue from operations growing at a CAGR of 19.26% from ₹1,129.04 crore in FY2024 to ₹1,605.95 crore in FY2026. EBITDA expanded at a CAGR of 47.41% over the same period. After reporting net losses in FY2024 and FY2025 primarily due to ramp-up costs at new hospitals, the company returned to profitability in FY2026 with a Profit After Tax (PAT) of ₹43.83 crore.

Q1 FY2027 performance indicated strong operational momentum, with PAT of ₹49.68 crore already surpassing the full-year FY2026 PAT. Operating cash flows improved significantly from ₹92.48 crore in FY2024 to ₹163.51 crore in FY2026.

Why the Company Is Raising Funds

The identified net proceeds from the fresh issue, totaling ₹375.00 crore, are primarily earmarked for debt repayment. Approximately 85.56% of the identified proceeds (₹320.90 crore) will be used for the prepayment or scheduled repayment of outstanding borrowings at the company level. A further ₹54.10 crore (14.44%) will be invested in its wholly owned subsidiary, PMHPL, for the repayment or prepayment of borrowings. The remaining portion is allocated for general corporate purposes, including organic and inorganic growth, capital expenditure, marketing, working capital, and business development.

Business Strengths

Paras Healthcare benefits from a capital-efficient operating model that utilizes a mix of owned, leased, revenue-sharing, and public-private partnership models. This approach reduces upfront capital intensity, with capital expenditure per bed recorded at ₹7.70 million as of 30-Jun-2026. The company maintains a patient satisfaction score of 90.60 and a net promoter score of 93.31 as of 31-Mar-2026.

Government scheme empanelment under CGHS, ECHS, and AB-PMJAY provides a stable revenue base, accounting for approximately 41–44% of total revenue in recent periods. The company also operates DNB/DrNB programs training up to 60 students annually across 14 specialties, enhancing its academic credentials and talent pipeline.

Key Risks

The company faces substantial indebtedness, with outstanding fund-based borrowings of ₹9,394.67 million (₹939.47 crore) as of 31-Aug-2026. The interest coverage ratio declined to 0.75x in FY2025, indicating debt service stress during the loss-making period. Additionally, the company has a history of losses in FY2024 and FY2025, and no assurance can be given regarding sustained profitability.

High attrition rates among healthcare professionals pose a operational risk, with overall attrition rates recorded at 60.38% in FY2026 and 66.74% in FY2025. Retainers and consultants fees account for approximately 25% of total expenses. Geographic concentration is another factor, with five of eight hospitals located in North India contributing approximately 66–68% of revenue. Six of the eight hospitals operate on leased premises, with lease deeds for Panchkula, Darbhanga, Ranchi, and Srinagar hospitals being unregistered.

Important IPO Dates

The IPO subscription window opens on 21-Oct-2026 and closes on 23-Oct-2026. Allotment is scheduled for 26-Oct-2026, with the listing date set for 28-Oct-2026.

Bottom Line

Paras Healthcare presents a growth-oriented profile with a 19.26% revenue CAGR and a recent return to profitability. The primary use of proceeds for debt repayment aims to strengthen the balance sheet, addressing high leverage ratios. However, investors face risks related to high staff attrition, geographic concentration, and regulatory dependencies on government schemes.