Tech giants could buy stake in Indian lab test chain Metropolis

Mumbai-based lab test company Metropolis Healthcare is looking to raise roughly $300 million and add a strategic partner by selling a minority stake of the business, Bloomberg reports.

Why it matters: Fueled by the pandemic, diagnostics have become an up-and-coming business. Amazon launching a lab testing division last summer and LabCorp recently unveiling a home testing and appointment-booking portal.

Chains like Metropolis have thus become targets for such giants looking to expand in India.

• Amazon, for its part, has held preliminary discussions with Metropolis, per Bloomberg.
• Metropolis' other major potential strategic advisors include Walmart-owned Flipkart and health care chain Apollo Hospitals, both of whom signed NDAs with the diagnostics company.

Context: With more than 3,000 facilities in India and Africa, Metropolis has a market value of $1.1 billion.

Flashback: That's about half of what it was in January 2022, likely due to concerns about increasing rivalry in the sector.

Be smart: Spending on preventive care, including diagnostics, has risen rapidly in India in recent years as its population increases.

• In the lab testing sector, a wave of consolidation has seen startups including digital pharmacy Pharmeasy buy a majority stake in publicly traded diagnostics business Thyrocare Technologies and Metropolis acquire lab testing chain Hitech Diagnostic Centre for $82 million, Bloomberg reports.

What's next: Metropolis plans to add nearly 2,000 collection centers over the next three years and add home collection to 200 locations by 2024, it has said in earnings and exchange filings.