Nephro Care India Ltd Management Discussions

Nephro Care India Limited

Financial Year 2025-26

1. Executive Summary and Industry Overview

Nephro Care India Limited ("NCIL" or "the Company") is a specialized healthcare provider focused on nephrology and allied healthcare services. The Company delivers comprehensive renal care solutions encompassing dialysis services, nephrology consultations, management of chronic kidney diseases (CKD), preventive healthcare services and associated medical treatments through its integrated healthcare delivery model.

FY 2025-26 was a significant year for the Company as it consolidated its position as a publicly listed healthcare enterprise following its successful listing on the NSE Emerge Platform. The Company continued to strengthen its service offerings, enhance patient outreach, and improve operational capabilities while maintaining its commitment to providing quality healthcare services.

2. Industry Structure and Developments

Indias healthcare sector continues to be one of the fastest-growing sectors of the economy, driven by increasing healthcare awareness, rising life expectancy, changing lifestyles, urbanization, and growing incidence of chronic diseases. The nephrology segment, in particular, is witnessing sustained growth owing to:

- Increasing prevalence of chronic kidney disease (CKD) and diabetes-related renal complications;

- Growing geriatric population requiring specialized renal care;

- Rising healthcare expenditure and penetration of health insurance;

- Government initiatives promoting access to affordable healthcare services;

- Growing awareness regarding preventive healthcare and early diagnosis.

The burden of kidney diseases in India continues to increase due to lifestyle-related disorders, hypertension, diabetes, obesity, and aging demographics. This has created significant demand for specialized nephrology services, dialysis centres, and integrated renal healthcare solutions.

3. Indian Chronic Kidney Disease (CKD) Market

Disease Burden

- India has an estimated 115 million CKD patients, making it one of the largest CKD populations globally.

- Epidemiological studies indicate CKD prevalence ranging between 12% and 21% across different regions of India.

- The SEEK India study estimated an overall CKD prevalence of 17.2%, with approximately 6% of the population suffering from Stage III CKD or worse.

- Rising incidence of diabetes, hypertension, obesity, ageing population, and lifestyle-related disorders continue to drive CKD prevalence across the country.

Key Growth Drivers

- Increasing prevalence of diabetes and hypertension, which account for a significant proportion of CKD cases.

- Improved awareness and screening initiatives.

- Expansion of health insurance coverage and government-sponsored healthcare schemes.

- Growing demand for dialysis and kidney transplantation services.

4. Indian Dialysis Market

Market Size & Growth

- The Indian haemodialysis market was valued at approximately USD 3.30 billion in 2025 and is projected to reach USD 6.03 billion by 2034, growing at a CAGR of 6.9%.

- The Indian peritoneal dialysis market was valued at approximately USD 969 million in 2025 and is expected to reach USD 2.32 billion by 2034, registering a CAGR of 9.9%.

Dialysis Patient Population

- Industry estimates suggest that India has more than 220,000?250,000 patients receiving dialysis treatment, while the annual incidence of End-Stage Renal Disease (ESRD) is estimated at 175,000?220,000 new patients annually.

- Demand significantly exceeds existing dialysis infrastructure, creating a large treatment gap, particularly in Tier-II and Tier-III cities.

Industry Characteristics

- Haemodialysis remains the dominant treatment modality.

- Increasing government support through the Pradhan Mantri National Dialysis Programme (PMNDP) has expanded access to dialysis services.

- The sector remains highly fragmented with substantial opportunities for organized players operating hub-and-spoke dialysis networks.

Growth Catalysts

- Increasing ESRD incidence.

- Better reimbursement mechanisms.

- Rising penetration of private dialysis chains.

- Greater adoption of technology-enabled dialysis centres.

Companys Position in the Industry

The Company has established itself as a specialized healthcare provider in the nephrology segment through its patient-centric approach, experienced medical professionals, and advanced healthcare infrastructure. By focusing on quality care, clinical excellence, and operational efficiency, the Company aims to strengthen its market presence and expand its service offerings in the growing renal healthcare segment.

5. Results of Operations

Financial Performance Overview

During FY 2025-26, the Company recorded substantial growth in revenues while continuing to invest in operational expansion and healthcare infrastructure.

Particulars	2025-26	2024-25	2025-26	2024-25
	Standalone	Standalone	Consolidated	Consolidated
Revenue from operations	8873.48	4,603.12	8873.48	-
Other income	154.75	152.68	154.75	-
Total revenue	9028.23	4,755.80	9028.23	-
Finance Cost	15.87	11.01	15.87	-
Depreciation and amortization	507.40	246.01	507.40	-
Other Expenses	8041.14	4,015.85	8041.14	-
Total Expenses	8564.41	4,272.87	8564.41	-
Profit/(Loss) before Tax (excluding exceptional item)	463.82	482.93	463.82	-
Less: Tax Expenses	126.92	(119.04)	126.92	-
Profit After Tax (excluding exceptional item and from continuing operations)	336.89	363.89	336.89	-
Add: Prior Period Adjustments (net)	-	-	-	-
Profit/(loss) for the year after prior period adjustments	336.89	363.89	336.89	-
EPS (Basic)	2.04	2.38	2.04	-
EPS (Diluted)	2.04	2.38	2.04	-

Revenue Analysis

The Company reported revenue from operations of Rs8,873.48 Lakhs during FY 2025-26 as compared to Rs4,603.12 Lakhs in FY 2024-25, representing a growth of approximately 93%.

The significant increase in revenue was driven by:

- Expansion of healthcare services and patient base;

- Increased utilization of existing healthcare facilities;

- Enhanced service offerings and treatment capabilities;

- Improved market penetration and brand visibility following the public listing;

- Growing demand for specialized nephrology and allied healthcare services.

Expense Analysis

Total expenditure increased to Rs8,564.41 Lakhs from Rs4,272.87 Lakhs in the previous year, reflecting the Companys expansion initiatives and scale-up of operations.

Key expense drivers included:

- Increased manpower and clinical staffing costs;

- Expansion-related operational expenses;

- Higher infrastructure and facility management costs;

- Investments in technology, medical equipment and patient care capabilities;

- Administrative and compliance costs associated with listed entity status.

Depreciation and amortization expenses increased to Rs507.40 Lakhs from Rs246.01 Lakhs, reflecting capital investments in healthcare infrastructure and medical equipment.

Profitability Analysis

Despite robust revenue growth, Profit After Tax stood at Rs336.89 Lakhs compared to Rs363.89 Lakhs in the previous year. The moderation in profitability was primarily attributable to:

- Higher operating costs associated with business expansion;

- Increased depreciation resulting from investments in infrastructure and equipment;

- Additional compliance and governance costs associated with being a listed company;

- Strategic investments aimed at long-term growth and capacity creation.

- Management believes that these investments will support future revenue growth and operational efficiencies.

6. Liquidity and Capital Resources

The Company continues to maintain a prudent approach towards financial management and capital allocation.

Capital Structure

As on March 31, 2026:

- Authorized Share Capital: Rs20.00 Crores

- Paid-up Equity Share Capital: Rs16.49 Crores

The Company successfully completed its Initial Public Offering and continues to benefit from an enhanced capital base and improved market visibility.

Cash Flow and Liquidity Position

The Companys liquidity position remained adequate during the year to support:

- Day-to-day operational requirements;

- Capital expenditure programmes;

- Working capital needs;

- Statutory and regulatory obligations.

The management continuously monitors cash flows, receivables, and working capital cycles to ensure efficient utilization of resources and maintenance of adequate liquidity buffers.

Capital Expenditure

The Company continued investments in healthcare infrastructure, technology, and medical equipment aimed at improving service quality, operational efficiency, and patient outcomes.

Debt Management

The Company maintains a conservative financial strategy with emphasis on maintaining a healthy balance between growth investments and financial stability. Management remains focused on optimizing capital deployment while preserving financial flexibility for future expansion opportunities.

7. Risk Factors and Uncertainties

The healthcare industry operates in a dynamic environment and is exposed to various business, operational, regulatory, and economic risks.

Regulatory Risk

Healthcare providers operate under extensive regulatory oversight. Any changes in healthcare regulations, licensing requirements, clinical protocols, or compliance standards may impact operations and costs.

Mitigation: The Company maintains strong compliance systems, periodic audits, and continuous monitoring of regulatory developments.

Healthcare Industry Risk

Changes in healthcare reimbursement models, patient preferences, technological advancements, and competitive dynamics may impact business performance.

Mitigation: Continuous focus on quality healthcare delivery, clinical excellence, and patient satisfaction.

Talent and Human Resource Risk

The availability and retention of qualified doctors, nephrologists, nurses, and healthcare professionals remain critical for sustained growth.

Mitigation: Competitive compensation structures, professional development initiatives, and employee engagement programmes.

Technology and Cybersecurity Risk

Increasing dependence on digital healthcare systems exposes the Company to information security and cybersecurity risks.

Mitigation: Implementation of robust IT controls, data security measures, and periodic system reviews.

Economic and Market Risk

Macroeconomic conditions, inflationary pressures, and changes in healthcare spending patterns may affect operating performance.

Mitigation: Diversified service offerings, efficient cost management, and disciplined capital allocation.

Clinical and Operational Risk

Healthcare services inherently involve clinical and operational risks that may impact patient outcomes and reputation.

Mitigation: Adoption of standardized clinical protocols, quality assurance mechanisms, continuous training, and patient safety frameworks.

8. Critical Accounting Estimates

The preparation of financial statements in accordance with applicable accounting standards requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses.

Key areas involving significant management judgment include:

Revenue Recognition

Revenue is recognized based on healthcare services rendered to patients and other applicable contractual arrangements. Management assesses timing and measurement of revenue recognition in accordance with applicable accounting standards.

Property, Plant and Equipment

Useful lives, residual values, and impairment assessments relating to medical equipment and healthcare infrastructure involve management estimates and periodic review.

Employee Benefits

Valuation of employee benefit obligations requires actuarial assumptions relating to discount rates, salary escalation, and employee attrition.

Provisions and Contingencies

The Company evaluates legal, regulatory, and contractual obligations to determine appropriate provisions and disclosures.

Deferred Tax Assets and Liabilities

Recognition and measurement of deferred tax balances involve assumptions regarding future taxable profits and applicable tax regulations.

Management believes that the estimates used are reasonable and based on available information; however, actual results may differ from such estimates.

9. Future Outlook and Forward-Looking Statements

Indias renal healthcare sector presents significant long-term growth opportunities driven by increasing disease prevalence, improving healthcare accessibility, and rising healthcare awareness.

The Companys strategic priorities for the coming years include:

- Expansion of nephrology and allied healthcare services;

- Strengthening healthcare infrastructure and treatment capabilities;

- Increasing patient reach through enhanced service networks;

- Leveraging technology and digital healthcare solutions;

- Improving operational efficiencies and clinical outcomes;

- Exploring strategic growth opportunities through partnerships and expansion initiatives.

The Board remains optimistic about the Companys long-term prospects and believes that its specialized healthcare focus, experienced management team, strong clinical capabilities, and growing market presence position it favourably to capitalize on emerging opportunities in the healthcare sector.

Forward-Looking Statement

This Management Discussion and Analysis contains certain forward-looking statements concerning the Companys future business prospects and business profitability. These statements are subject to several risks, uncertainties, assumptions, and other factors that could cause actual results to differ materially from those expressed or implied. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

For and on behalf of the Board of Directors

Nephro Care India Limited