API Holdings Ltd – India’s Largest Digital Healthcare Platform

Overview:

One of the health technology companies with the fastest rate of growth in India is API Holdings Ltd. Serving customers, pharmacies, healthcare providers, and institutions nationwide, it runs an integrated, end-to-end digital healthcare ecosystem that blends e-pharmacy, diagnostics, telehealth, and healthcare supply-chain services. One of the top digital healthcare marketplaces in India, PharmEasy, is its flagship consumer-facing brand.

API Holdings was formally founded in 2019 by combining previous businesses that date back to 2012. Since then, it has expanded quickly through both organic growth and strategic acquisitions, including Medlife (2021) and a majority stake in Thyrocare (2021).

Vision & Business Model

The mission that API Holdings is striving to achieve is to create the most complete digital healthcare ecosystem in India using technology, logistics and healthcare data to provide affordable, convenient and accessible care to millions. Its own-designed platform links several stakeholders, such as consumers, pharmacies, doctors, clinics, diagnostic labs, wholesalers and manufacturers.

The company has a number of synergistic segments:

 1. E-Pharmacy and Healthcare Marketplace (PharmEasy).

Allows customers to make orders through app and web on medicines, healthcare goods and wellness products.

Provides tele consultancy service, e-prescription and medication ordering.

Transaction commission and logistic fees and charges in the marketplace are revenue drivers.

 2. Diagnostics Preventive Health (Thyrocare)

A significant diagnostic services company that has tests in the country.

Empowers the ecosystem by integrating diagnostics and pharma and telehealth services.

 3. B2B Distribution and Supply Chain (Retailio and other websites)

Pharmacist and healthcare retailer digital procurement tools that help enhance inventory and ordering management. The services are wholesale distribution, practice management software and hospital supplies procurement.

Growth Story and Strategic Acquisitions.

API Holdings was not established as a one-stop platform. it was based on previous projects:

2012-2014: Founders created Dialhealth (delivery of medicine), pharmacy networks and supply-chain services.

2015: PharmEasy marketplace was launched in its initial form, which had on-demand home delivery.

2017-2020: The Retailio was created to digitalise drug distribution and pharmacy procurement.

2020: API Holdings consolidated all the businesses.

2021: 33 percent majority stake of Thyrocare, acquisition of major e-pharmacy Medlife, to construct a more holistic health platform.

This expansion strategy made API Holdings the biggest digital healthcare company in India based on gross merchandise value (GMV).

Financial Overview:

Key takeaways from financials:

✅ Early years saw strong top-line growth, fuelled by acquisition synergies and market penetration.

✅ Revenue grew modestly in FY25 after plateauing in FY24, a sign of competitive dynamics and market pressure.

✅ Reduction in losses: As operations grow, margins have improved steadily, with the EBITDA margin rising from -39.7% to -9.3% over the course of three years.

Intense customer acquisition efforts, logistics expenses, and supply infrastructure investments—all typical characteristics of high-growth tech platforms—are partially to blame for API Holdings' high costs. 

Valuation

Financial Ratios and the Balance Sheet

The evolution of the company's balance sheet reveals:

• Debt reduction: By FY25, net debt had drastically dropped from its peak around FY23, enhancing solvency.
• Leverage improved: by FY25, debt/equity was less than 1x.
• Due to losses, returns (ROE/ROCE/ROA) are still very negative, but as margins improve, the trend is getting better.
• The key to making these ratios positive in the future is cost optimisation and scalable digital operations.

Future Forecast With Assumptions

Revenue growth of 15-18% is assumed upon assessment of the historical performance of API Holdings which normalised its growth after the hyper-growth of FY 22 and the median growth of the past five years is 8-9%. In this regard, the forecast is adjusted to the growth trends in the industry, but not outstanding pandemic-based years.

It is valued at a Price to Sales ratio of 5x-7x since the earnings are still negative. The multiple will be pegged to the existing trading range of the company of 4-5x P/S, and a calculated premium will be taken in view of increasing scale, better operating margins, and leadership in digital healthcare and will still take into consideration the risk of execution and profitability.

According to these assumptions, the FY30 revenue is estimated at 5723-7486 Cr meaning that the valuation may vary between 28616-52403 Cr and per share will be 16.80-30.77. Long-term growth visibility is further supported by the fact that the EBITDA and PAT losses show a steady decrease.

Peer Comparison