In India's healthcare market, servicing devices beats selling them

The flashiest part of India's medical technology market usually revolves around high-end scanners, surgical robots and new diagnostic platforms. But the real business, at least in India's small cities, lies in something far less glamorous: keeping existing machines running.

Somerset Indus Capital Partners' medtech companies serviced nearly one million biomedical devices last year, according to the firm's latest report. By contrast, fewer than 1,000 new devices were sold during the same period, a data point that underscores a reality in India's healthcare system: equipment uptime, not equipment ownership, determines whether patients receive timely care.

More than 24,000 healthcare facilities rely on these service programmes, two-thirds of them in Tier-II and Tier-III towns. Public hospitals account for more than half of all clients, reflecting chronic shortages of biomedical staff and limited budgets for new equipment in India's government system.

Cyrix, one of Somerset's device-service platforms, reported equipment uptime of 98%, supported by preventive servicing, calibration, spare-part stocking and digital dashboards that monitor machine health in real time. GenWorks, another portfolio company, has rolled out cloud-enabled and AI-assisted monitoring for specialty devices.

The commercial logic is compelling: maintenance generates recurring revenue, maintains long-term customer relationships and avoids the cyclical capital purchases that dominate traditional device sales. In district hospitals, equipment failure often leads to weeks of downtime, test cancellations and delays in critical interventions. 

Somerset is betting that as India's healthcare infrastructure expands, the maintenance economy, engineering talent, spare parts, digital tracking and refurbished clinical devices will become as important as the devices themselves. In a market where machines outlast budgets, it may also be the most reliable segment of the Medtech business.

India has spent the past decade installing thousands of diagnostic and clinical machines across public hospitals, district centres and small private facilities. But while the country’s medical-technology footprint has expanded, many of these devices operate far beyond their intended life cycle. Hospitals in smaller cities often lack trained biomedical engineers, leaving equipment idle for weeks when it breaks down or needs calibration.

The push from the National Health Mission has added pressure to keep machines running. Government programmes have expanded imaging and pathology capacity inside district hospitals, but the benefits depend on whether equipment stays functional. Limited procurement budgets mean hospitals rely heavily on refurbished or older machines, extending replacement cycles to ten years or more.

In this environment, outsourced maintenance is often the only way facilities can keep services running. Many hospitals, especially in Tier-2 and Tier-3 markets, operate a patchwork of brands and outdated models, making multi-vendor servicing more essential than hardware upgrades. Digital monitoring tools are just beginning to take hold, replacing paper logbooks with early-warning systems that flag equipment failures before they shut down services.

For investors, service-led Medtech businesses offer steadier economics than device sales. Maintenance contracts generate recurring revenue and remain essential regardless of capex cycles. When machines fail, emergency rooms, ICUs and maternity wards can’t operate normally, so hospitals prioritise uptime even when budgets are tight. As India expands healthcare infrastructure, the segment focused on keeping equipment functional, rather than selling new machines, is becoming one of the most stable parts of the medtech market.