Aster sets sights on Chennai, kicks off 25-acre land deal for 500-bed MedCity

CHENNAI: Aster DM Healthcare is making a serious push into Tamil Nadu’s healthcare space, with the group now moving to set up its first hospital in Chennai. Multiple sources told DT Next that the Rs 4,138 cr Aster has begun acquiring about 25 acres in Kovilambakkam through private agencies, marking the start of its city debut.

The proposed healthcare campus is planned as a 500bed MedCity, bringing together multi-specialty tertiary care, advanced diagnostics and facilities aimed at tapping the city’s growing medical tourism market. The project will also help Aster strengthen its network in south India, where it has so far concentrated in Kerala and Karnataka.

Developing a 500-bed hospital of this scale in Chennai typically entails an investment of Rs 800 to 1,200 crore, depending on the clinical mix, equipment and phased expansion. Land cost is a key driver: in Kovilambakkam, parcels along key stretches are currently quoted in the range of Rs 10 to 20 crore per acre, jacking up the total real estate outlay alone potentially beyond Rs 250 crore for a project of this size. The development comes on the back of Aster’s recent strategic shift to scale up its India operations. The group, which has over 30 hospitals across India and the Gulf Cooperation Council, is looking to double its bed capacity in the country over the next few years through a mix of greenfield projects and acquisitions.

As per industry watchers, Chennai’s fast-growing southern suburb, makes Kovilambakkam a prime catch for hospital expansion. Though Aster is yet to officially announce the project, the ongoing land transactions underscore its intent to take on entrenched players such as Apollo Hospitals, Kauvery and MGM in one of India’s most competitive healthcare markets. Attempts by DT Next to reach out to Aster’s operations head did not yield any positive outcome.