Rainbow Children’s Medicare Limited (RCML), India’s premier pediatric multispecialty and perinatal care hospital chain, has signed a definitive agreement to acquire a controlling stake in Prashanthi Medicare Private Limited (“Prashanthi Hospital”) located in Warangal, Telangana. Warangal is the state’s second-largest district and a growing business hub, making this acquisition a strategic move in RCML’s expansion plan.
Strengthening Presence in Southern India
Dr. Prasanthi Macha established Prashanthi Hospital in 2015 as a 100-bed NABH-accredited facility, renowned for its excellence in obstetrics, gynecology, neonatology, pediatrics, and minimally invasive surgery. The region widely trusts the hospital for its patient-centric care and strong clinical outcomes, especially for women and children.
With this acquisition, RCML continues to strengthen its footprint across southern India. The addition of Prashanthi Hospital expands RCML’s total network capacity to 2,035 beds across 20 hospitals in 7 cities. The company strategically focuses on tier-II cities, where specialized healthcare services remain limited.
Transaction Highlights
RCML has valued Prashanthi Hospital at approximately INR 32.60 crore (subject to working capital adjustments), representing around 9 times the estimated adjusted EBITDA for FY25. The acquisition will be entirely funded through RCML’s internal accruals and existing cash reserves.
Under the agreement, RCML will acquire:
- 76% of the fully diluted equity capital
- 100% of the Non-Convertible Redeemable Preference Shares (NCRPS)
Dr. Prasanthi Macha and her associates will retain a 24% minority stake in the hospital.
Rebranding and Integration Plans
Following the acquisition, RCML plans to rebrand the facility into two distinct verticals:
- Rainbow Children’s Hospital for pediatric and neonatal care
- Prashanthi with BirthRight for women’s healthcare services
Moreover, RCML will integrate the Warangal facility into its successful hub-and-spoke model. This will ensure smooth referral pathways and clinical coordination with the Hyderabad hub for advanced care.
Leadership Commentary
Dr. Ramesh Kancharla, Chairman and Managing Director of RCML, expressed enthusiasm about the acquisition:
“We are delighted to welcome Prashanthi Hospital into the Rainbow network. This partnership deepens our roots in Telangana and enables us to offer advanced pediatric and maternal care to families in the Warangal region through our proven hub-and-spoke model.”
As reported by equitybulls, Dr. Prasanthi Macha, Director of Prashanthi Hospital, also shared her excitement:
“We are proud to join hands with Rainbow, a national leader in pediatric and women’s healthcare. Their clinical expertise and leadership will help us elevate the quality of care we provide to our community.”
This acquisition marks a significant milestone in RCML’s growth journey. The company continues to bring world-class pediatric and maternal care to underserved regions across India.