16-05-2025
US tailwinds, AI investments, to drive growth for IKS Health
Jhunjhunwala family-backed Inventurus Knowledge Solutions (IKS) aims to grow faster than the market in FY26 with more investments in artificial intelligence (AI), improving synergies with its acquired company AQuity Solutions and tailwinds in the US, CFO Nithya Balasubramanian told Mint in an interview.
The Mumbai-based company offers tech-led healthcare solutions to hospital and clinic groups in the US. The sector's total addressable market in the US is $222 billion, of which $34 billion is outsourced.
'This outsourced market is growing at 12%, and we should be able to grow faster than the market…given the strength of [our] business model, we believe that we should be able to continue to grab market share," Balasubramanian said.
IKS Health, which listed on the exchanges in December, posted its financial results for the quarter ended 31 March 2025, late on Thursday. The company reported strong revenue growth of 17% year-on-year in Q4FY25 to ₹724 crore, owing to a ramp-up of new clients. The company's profit after tax grew 133% y-o-y to ₹148 crore. It posted a healthy Ebitda margin of 31% during the quarter.
Overall for FY25, it posted revenue of ₹2,664 crore, growing 47% y-o-y, with a margin of 30%.
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'The last quarter saw five prominent client wins, including three platform deals, which gives us the confidence in our strategy of building the full breadth of our platform in a market that largely consists of point solutions companies," founder and CEO Sachin K. Gupta said in a release. Point solutions companies are also known as one-solution companies.
The firm offers 16 features to clients, from optimized patient visit scheduling to revenue optimization solutions that help firms maximise revenues and more, and is targeting selling all of its features in platform deals to clients. Balasubramanian said there has been an uptick in interest and demand for this.
She said that consumers are increasingly opting for IKS Health's full range of solutions rather than picking one or two and using other companies for the rest.
Growth drivers
Balasubramanian said the company will focus on AI investments in FY26, adding that it is trying to increase automation across all of its offerings. The company's total R&D spend is about 4.5-5.0% of its revenue.
The Trump administration's focus on cutting healthcare costs is also a tailwind for the company, as clients look to reduce costs and improve efficiency.
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'From our business perspective, these kinds of cost-cutting initiatives or efficiency-finding initiatives will be largely attainable for us because we are part of the solution," Balasubramanian said. 'Our platform actually allows provider organizations and health systems to be able to deliver their operations more efficiently," she said.
The company has seen an uptick in interest and queries. 'The fact that we have been able to nudge more of our clients towards platform deals to me is also an indication that the conversations are shifting," she said.
Additionally, the company has been able to improve synergies with its acquired entity, AQuity Solutions, in FY25. 'We have been able to transform AQuity's business model quite significantly," Subramanian said.
AQuity, which offers clinical documentation, medical coding, and revenue integrity solutions, had 2-3 features as opposed to the 16 offered by IKS. AQuity, too, provides services to hospitals and healthcare chains like IKS Health. 'Most of them were delivered in an entirely human-led manner and also mostly onshore. From there, we have been able to deploy a combination of IKS's technology as well as change the mix from onshore to offshore," Subramanian said.
AQuity was acquired by IKS in 2023 in a $200 million deal.
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While the market for healthtech solutions and revenue cycle management (RCM) businesses is getting more competitive, Subramanian believes there is significant room for growth and that the company will be able to maintain its lead.
'We are differentiated because of the platform that we have to offer. Second, the kind of data that we have to be able to mature the tech faster than a newer player [and] the kind of deep relationships that we have," she said.
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