HCG Raises Vizag Hospital Stake to 85% Amid Clinical Trial Investigation

HealthCare Global Enterprises (HCG) has acquired an additional 34% stake in Vizag Hospital, costing ₹154.50 crore and raising its total holding to 85%.

Deal Details

HealthCare Global Enterprises Ltd. (HCG) announced it has completed buying an additional 34% equity stake in Vizag Hospital and Cancer Research Centre Private Limited for ₹154.50 crore. This purchase raises HCG's total stake in Vizag Hospital to 85%.

HCG acquired 1,93,441 shares in this transaction. The deal, initially agreed on June 28, 2024, was finalized after several amendments, with the most recent on March 29, 2026.

Strategic Importance

This acquisition strengthens HCG's control over Vizag Hospital, a key oncology center. An 85% stake gives HCG more power to integrate operations, clinical methods, and financial reporting, potentially improving efficiency and synergies.

Background

HCG has gradually increased its stake in Vizag Hospital since June 2024. The company's board approved an investment plan in March 2026 for up to ₹155.66 crore to buy this additional stake. A rights issue approved in February 2026 also supports this expansion.

Earlier, in June 2025, KKR became HCG's largest shareholder and promoter after acquiring a controlling stake, signaling investor confidence in HCG's growth.

Key Impacts

• Greater Control: HCG now owns 85% of Vizag Hospital, allowing for smoother management and strategy.
• Financials: Vizag Hospital's financials will now be fully included in HCG's balance sheet, showing a larger operational scale.
• Synergies: Increased control could lead to operational and clinical efficiencies, improving services and costs.
• Market Strength: This boosts HCG's position in Visakhapatnam and its overall specialized cancer care network.

Regulatory Risk

The main risk for HCG currently involves allegations of ethical violations and irregularities in clinical trials at its Bengaluru facility. The Central Drugs Standard Control Organization (CDSCO) is investigating these matters.

In 2023, Eli Lilly and Company stopped HCG's participation in two clinical studies due to protocol violations, affecting patient safety. HCG denies wrongdoing and states it follows all regulatory guidelines, but the ongoing investigation presents a significant reputational and regulatory challenge.

Competitive Landscape

HCG runs a specialized cancer care network, unlike broad multi-specialty hospital chains like Apollo Hospitals, Max Healthcare, and Fortis Healthcare. While peers focus on scale and broad services, HCG prioritizes deep oncology expertise.

Its consolidation in Vizag Hospital shows a targeted strategy in its niche, aiming for market leadership.

Financial Snapshot

Vizag Hospital reported ₹110.14 crore in revenue and ₹18.79 crore in profit after tax for the year ended March 31, 2025. Its subsidiary, HCG NCHRI LLP, had ₹89.80 crore in revenue and ₹17.02 crore in profit after tax for the same period.

Looking Ahead

• Clinical Trial Investigation: Monitor the outcome of the CDSCO's investigation.
• Vizag Hospital Integration: Observe how HCG integrates operations and finds synergies.
• Financial Performance: Track the consolidated financial impact on HCG's future results.
• Regulatory Compliance: Watch for any further regulatory actions regarding the clinical trials.
• Strategic Updates: Follow HCG's announcements on network expansion and consolidation.