India’s IVD Market: Growth Trends and Opportunities | Praxis Insights

Four trends are expanding the opportunity for IVD players and creating new avenues for value creation

India’s in-vitro diagnostics (IVD) market is entering a period of rapid growth. The market, estimated at ~US$2B in FY24, is projected to reach ~US$3.4B by FY29P, implying a ~14% CAGR. With India conducting only ~2 diagnostic tests per capita annually, compared with ~16 in developed markets, there remains significant headroom for further penetration.

Exhibit 1: India’s IVD market is large and rapidly growing

Shaping the next phase of IVD growth

The market is being shaped by four trends: expanding diagnostic access, manufacturing localization, export competitiveness and increasing private and capital-market activity.

Diagnostic chains and healthcare facilities are expanding beyond the largest cities, broadening access to diagnostics and expanding the addressable testing market across healthcare settings and testing volumes. As diagnostic demand reaches more geographies, distribution and service capabilities are also becoming increasingly important to effectively serve the market.

At the same time, greater manufacturing localization is improving the economics of the IVD ecosystem. Local production can create structural cost advantages, improve affordability of instruments and consumables, and enable more competitive pricing, while providing companies greater flexibility on pricing and margins.

India’s global relevance is also increasing. Medical-device exports reached ~US$ 4.1B in FY25, growing at ~13% CAGR between FY21–25. Growing manufacturing capabilities and cost competitiveness could enable India to increasingly participate in global medical-device and diagnostics value chains, while expanding the addressable opportunity beyond the domestic market.

Finally, increasing private and capital-market activity is providing capital for capacity expansion, technology investment, M&A and portfolio expansion, potentially accelerating the scale-up of the ecosystem. As the market grows, M&A could also provide a route for companies looking to establish or deepen their presence in India, alongside opportunities to broaden portfolios and capabilities.

Exhibit 2: Four structural shifts are expanding the IVD opportunity and improving economics for Indian players

The road ahead

India’s IVD market is entering a phase where market expansion is increasingly being accompanied by changes in industry economics and competitive dynamics. Rising diagnostic penetration, expanding access beyond metros, greater localization, growing global relevance and increasing investment are creating multiple avenues for growth across the ecosystem.

For investors and IVD companies, the priority should be to align their growth strategies with these shifts, expanding reach into emerging geographies to capture incremental volumes, evaluating localization opportunities to improve cost competitiveness and margins, building capabilities to address global markets, and using M&A selectively to accelerate portfolio or geographic expansion.

The next phase could therefore favor businesses that can translate market growth into profitable scale by combining market reach, cost competitiveness, product capabilities and the ability to scale across geographies.