Apollo Hospitals to spin off pharmacy, digital health biz into new entity
As part of the proposed composite scheme, Apollo will carve out its digital health and pharmacy operations, including its stake in Apollo HealthCo Ltd (AHL), into a newly formed company, NewCo. This will be followed by the merger of AHL into NewCo.
Apollo Hospitals Enterprise Ltd (AHEL), India’s largest listed healthcare provider, is demerging its omnichannel pharmacy and digital health business—comprising the Apollo 24x7 telehealth platform and its investment in Apollo HealthCo Ltd—into a new standalone entity.
As part of the proposed composite scheme, Apollo will first carve out its digital health and pharmacy operations, including its stake in Apollo HealthCo Ltd (AHL), into a newly formed company, NewCo. This will be followed by the merger of AHL into NewCo.
In a parallel move, Keimed Pvt Ltd, one of India’s largest pharmaceutical wholesalers, will also be consolidated into the new platform, creating a fully integrated, end-to-end distribution and digital healthcare company.
Apollo HealthCo had clocked Rs 16,300 crore in FY25. The new entity (NewCo) is expected to reach Rs 25,000 crore by FY27, operating at an estimated EBITDA margin of 7%. It is also expected to list independently on Indian stock exchanges within 18 to 21 months, pending regulatory approvals.
Apollo said the new company (NewCo) will be an Indian-owned and controlled firm and is expected to be listed on Indian stock exchanges in 18–21 months, pending regulatory approvals. As part of the plan, NewCo will buy the remaining 74.5% stake in Apollo Medicals Pvt Ltd (AMPL), which fully owns Apollo Pharmacies Ltd (APL), giving it full control of the pharmacy business.
After the restructuring, Apollo Hospitals will hold a 15% stake in NewCo to maintain integration across its healthcare services.
“The omni-channel pharmacy business and integrated digital healthcare ecosystem will be a unique model to enable access to high-quality healthcare for millions of Indians,” said Dr Prathap C Reddy, Apollo Hospitals Group Chairman.
Post-restructuring, Apollo Hospitals will retain a 15% stake in NewCo to maintain strategic integration across its healthcare ecosystem.
"Once integrated, the new entity will be a truly customer-focused healthcare leader, delivering medicines from 7,000+ physical stores and an online platform serving over 19,000 pincodes, with Keimed ensuring supply chain integrity. Our aspiration is to serve over 100 million Indians,” said Shobana Kamineni, Apollo HealthCo Executive Chairperson.
In a recent interview with Mint, Kamineni had said that the Healthco business was expected to reach a valuation of Rs 30,000 crore over the next five to six years.
The integration of Keimed and Apollo’s digital assets will position NewCo as India’s largest integrated omnichannel pharmacy and distribution platform, and a significant player in the evolving consumer health landscape.
Where Apollo HealthCo stands
Apollo HealthCo operates in a competitive landscape with several healthcare players building integrated models combining pharmacy, diagnostics, teleconsultations, and chronic care.
Its closest peer, Tata 1mg, leverages the Tata Group’s reach, although it lacks Apollo’s large offline presence and hospital integration. Apollo HealthCo has a large retail network of over 6,000 drugstores. Meanwhile, Tata 1mg is expanding its physical presence across the country.
Online pharmacy startup PharmEasy is restructuring its business after a valuation markdown; three of its founders have stepped back from the company.
Edited by Swetha Kannan