From Herbs to Hospital Beds: Inside KRM Ayurveda’s IPO Story

KRM Ayurveda Limited, established in 2019, operates a network of six hospitals and five clinics across India, specializing in holistic treatments for chronic ailments such as kidney disorders, liver cirrhosis, and diabetes. The company also maintains a global presence through its telemedicine services and is engaged in the manufacturing and trading of Ayurvedic medicines and wellness products.

IPO Details

Before the Deep Dive: What’s Working — and What Isn’t

Now let’s move forward to unfold the whole business story and their numbers

Industry Landscape

The Indian Ayurveda industry operates within the broader AYUSH healthcare ecosystem, which includes Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homoeopathy. Ayurveda remains the largest and most commercially developed segment, driven by rising consumer preference for natural therapies, chronic disease management, and preventive healthcare.

The Indian AYUSH market has seen a dramatic expansion, skyrocketing from  $2.85 Bn. in 2014 to $24 Bn. in 2024, a nearly tenfold increase over an eleven-year period. This trajectory is expected to continue, as the market is  projected to reach $200 Bn by 2030. Ayurveda is a cornerstone of this traditional medical landscape and is currently recognized as a formal medical system in over 30 countries. Within India, it remains a primary choice for many, with 40.5% of the rural population and 45.5% of the urban population utilizing Ayurvedic treatments for ailments. The Ayurveda product industry alone is anticipated to grow to $16.2 Bn by 2028. India is a global destination for wellness tourism as it attracts approximately 2 million patients annually from 78 countries who seek affordable and authentic traditional treatments.

From a supply standpoint, the market remains highly fragmented, dominated by:

• Small standalone clinics and practitioners (service-only)

• Regional Ayurvedic medicine manufacturers

• Large FMCG-led Ayurveda brands with pan-India reach

Very few players operate an integrated model combining clinical services with proprietary product monetization, leaving scope for organized platforms to gain share. The regulatory oversight is anchored by the Ministry of AYUSH and the Drugs & Cosmetics Act government-led initiatives such as the National AYUSH Mission focus on strengthening AYUSH infrastructure, upgrading hospitals and dispensaries, improving drug quality standards, and enhancing practitioner availability across states. In parallel, increased budgetary allocation, inclusion of AYUSH treatments under public health schemes, and institutional adoption through CGHS and ECHS have expanded formal demand and reimbursement-backed patient flows. funds getting tied

KRM Ayurveda operates an integrated Ayurveda-focused healthcare and wellness platform, combining clinical services, proprietary formulations, and retail distribution under a single brand. The company’s model is designed to capture value across the diagnosis → treatment → product consumption lifecycle rather than remaining a pure product or clinic-led business.

KRM Ayurveda Limited operates a network of hospitals and clinics throughout India and maintains an international presence through telemedicine consulting and sales. The company runs through a Direct-to-Consumer (D2C) model, primarily generating revenue through specialized medical services and the sale of Ayurvedic products. While the company originally focused on specialized kidney care, it has expanded its scope to address various health disorders, including liver cirrhosis, diabetes, fatty liver, arthritis, and addiction, skin and hair care, women’s wellness, geriatric care.

Their business model consists of two main pillars:

• Healthcare Services: The company currently runs 6 hospitals and 5 clinics that provide in-patient (IPD) and out-patient (OPD) care. These facilities offer Panchakarma therapies, specialized wellness programs for stress and weight management, and personalized diet and lifestyle counseling.

• Product Division: The company is engaged in the formulation, processing, and trading of a diverse portfolio of Ayurvedic medicines, supplements, and oils. These products are manufactured at their own GMP-certified processing unit and include various forms such as tablets, capsules, syrups, and powders. Product portfolio is primarily focused on addressing chronic lifestyle and metabolic disorders. The Company markets its products through its network of hospitals and clinics and also provides patient access through an integrated telemedicine service, enabling remote consultations and product delivery

(Values in INR)

Revenue stream and mix

Hospitals & Clinics:  

• Direct Patient Services: This includes OPD, IPD, and therapy charges. Our Ayurvedic Hospitals and Clinics generate revenue through personalized consultations, Ayurvedic therapies like Panchakarma, massage treatments, and wellness programs. 

• Wellness & Preventive Packages: Customizable wellness packages combining consultations, therapies, and lifestyle courses help sustain recurring revenues and client retention.

Sale of Medicines: This is another revenue stream involving the sale of Ayurvedic medicines, herbal supplements, oils, skincare products, and other wellness-related items. Virtual consultations leveraging telemedicine also opens global markets.

Segment - Wise Revenue Bifurcation (Values in INR Cr.)

Revenue Break up based on In- Patient & Out - Patient Care in Services (Values in INR Cr.)

Geographical Profile

KRM Ayurveda operates 6 hospitals and 5 clinics located across seven Indian states: Delhi, Haryana, Uttar Pradesh, Bihar, Maharashtra, Karnataka, and Rajasthan. The states of Delhi and Haryana collectively accounted for 68.44% of total revenue for the period ending September 30, 20254. The Gurugram hospital in Haryana has seen rapid growth, increasing its revenue contribution from 3.5% in FY 23 to 27.5% in FY25.

The company maintains a strong global footprint through telemedicine consulting and product exports, specifically targeting the United States. Exports to the US represented 26.37% of total revenue for the period ending September 30, 2025.

The company is promoted by Mr. Puneet Dhawan and Mrs. Tanya Dhawan, who collectively hold 91.41% of the pre-issue paid-up equity share capital.

Mr. Puneet Dhawan (Managing Director): He holds a Bachelor of Ayurvedic Medicine and Surgery (BAMS) from the University of Delhi. With over 12 years of experience in the Ayurveda industry, he founded "Karma Ayurveda" in 2013 and has been recognized as the "Best Ayurveda Doctor in India" by the International Fame Awards.

Mrs. Tanya Dhawan (Non-Executive Director): She holds a Master’s degree in Mass Communication and a professional diploma in Dietetics. She has over three years of experience and provides specialized professional services in marketing and dietetic consultancy to the company.

IPO Objective

A primary objective is the construction of a new, company-owned Telemedicine Operational Facility, which is strategically designed to eliminate recurring rental expenses of approximately ₹78 lakh per annum and significantly expand operational capacity from around 200 to 500 seats to accommodate a growing marketing and sales workforce. To support this expansion and enhance patient engagement, the company intends to invest in proprietary CRM software and IT hardware, which will streamline customer data management, improve lead tracking, and increase the efficiency of teleconsultations and product conversion rates.

Furthermore, the company aims to utilize a portion of the proceeds to hire additional clinical staff—including doctors, nurses, and therapists—to ensure high-quality care and meet the increased patient load across its network of six hospitals and five clinics. The IPO will fafundcilitate the repayment of approximately ₹12.50 Cr. in borrowings, thereby reducing interest burdens and improving the debt-to-equity ratio to allow for future leverage if needed. Finally, a substantial allocation is directed toward working capital requirements, which have intensified due to the longer payment cycles associated with government schemes like CGHS and ECHS, as well as the need to maintain higher inventory levels for hospital pharmacies following recent expansions

Financial Analysis (Values in INR Cr.)

Revenue dropped from ₹89.28 Cr (FY23) to ₹67.15 Cr (FY24), then recovered to ₹76.55 Cr (FY25). The revenue dip in FY 2024 was intentional, resulting from a strategic pivot. The company shifted focus from a product-heavy model (telemedicine and medicine sales) to a hospital-services model. EBITDA improved sharply from ₹7.33 Cr in FY24 to ₹19.10 Cr in FY25, while margins expanded from 10.92% to 24.96%. This improvement is attributable to a favourable revenue mix shift toward high-margin hospital services, therapy programs, and in-house pharmacy sales, along with better absorption of fixed costs.Total borrowings increased during the expansion phase but the Debt–Equity ratio reduced materially from 2.38x in FY23 to 0.69x by Sept-25, driven by equity base expansion and partial debt repayment. This deleveraging trend reflects improving balance sheet strength and lower financial risk, even as the company continues to scale operations. Trade receivables increased to ₹24.01 Cr as of Sept-25, largely due to higher exposure to government and institutional patients under CGHS/ECHS with longer reimbursement cycles, which also led to volatility in operating cash flows, including negative OCF in FY24–FY25, though a return to positive OCF of ₹3.04 Cr in H1 FY26 signals early stabilisation. Employee cost as a percentage of revenue declined from a peak of 29.01% in FY24 to 20.78% in H1 FY26, indicating operating leverage as revenues scaled, while the government share of revenue rose significantly to 46.80% in H1 FY26, improving volume visibility but increasing working capital intensity.IPO

Final Words

Through the LMVT Framework

Leadership:
 KRM Ayurveda is a promoter-led healthcare platform driven by Mr. Puneet Dhawan, a qualified BAMS doctor with over a decade of hands-on experience in Ayurveda-led chronic care. Promoter involvement remains deep across clinical strategy, brand positioning, and expansion decisions, which supports execution alignment but also keeps the business dependent on promoter oversight and governance discipline.

Moat:

The company’s key differentiation lies in its integrated hospital-led Ayurveda model, combining IPD/OPD care, long-duration treatment programs, and in-house medicine sales. High bed occupancy (85% in FY25), improving ARPOB, and a growing share of service revenue indicate strengthening unit economics. The moat is operational rather than structural.

Valuation:

At ~23.73 FY25 earnings, the IPO is reasonably priced, especially when benchmarked against listed Ayurveda peers trading at materially higher multiples. The valuation offers comfort for investors willing to underwrite execution and working-capital risks, but meaningful rerating will depend on sustained cash-flow normalisation rather than margin expansion alone.

Tailwinds:
Rising acceptance of Ayurveda for chronic ailments, strong government support under AYUSH, increasing institutional patient inflows (CGHS/ECHS), and the company’s strategic shift from a product-heavy to a hospital-led model support medium-term growth. Capacity expansion, higher bed utilisation, and telemedicine scale-up provide additional revenue visibility.

Bottom Line:
KRM Ayurveda is transitioning from a telemedicine- and product-led model to a hospital-centric, high-margin integrated healthcare platform. While improving profitability, declining leverage, and strong industry tailwinds are positives, elevated working-capital intensity, receivable stretch from government business, and execution dependence remain key risks. Investor outcomes will hinge on the company’s ability to convert rising volumes into sustainable cash flows while maintaining clinical quality and governance discipline post listing.