Summary of "It’s Not Gold or Crypto : THIS Sector Is Quietly WINNING in INDIA | Aditya Khemka | FWS 90"

Video Title

It’s Not Gold or Crypto: THIS Sector Is Quietly WINNING in INDIA | Aditya Khemka | FWS 90

Key Finance-Specific Content Summary

Sector Focus: Indian Healthcare Sector

Returns & Growth

Over the last decade, investing ₹100 in Nifty50 would yield about ₹420-430 (~12% CAGR).
The same ₹100 invested in India-focused healthcare companies would yield ₹1,300 (~50% CAGR), roughly 3x faster growth than Nifty50.
Healthcare sector allocation in Nifty50 is very small (~3%), mostly in exporters like Sun Pharma, Dr. Reddy’s, Cipla, which have slow growth (1-2%) as they focus on mature Western markets.
Indian domestic healthcare companies focusing on branded generics and hospitals grow at 10-12%+.

Valuation Comparison

Largest food & beverage and clothing retailers trade at ~100x cash earnings.
Apollo Hospitals (largest hospital chain) trades at <50x cash earnings with ~17% ROE, just above cost of equity (~15%), indicating no supernormal profits.
Healthcare companies focused on Indian markets (e.g., Torrent Pharma) have shown extraordinary returns (Torrent Pharma up ~7x in 10 years vs. Sun Pharma ~30% growth).
Healthcare sector stocks are undervalued relative to their growth potential compared to other sectors.

Healthcare Subsectors

There are five main subsectors plus one ancillary sector:

Unbranded Generics Examples: Sun Pharma, Cipla, Lupin, Cadila
Branded Generics Examples: Torrent Pharma, Mankind Pharma, Mcure
Hospitals (fastest growing subsector)
Diagnostics (second fastest growing)
API and CDMO (Active Pharmaceutical Ingredients and Contract Development & Manufacturing Organizations)
Ancillary sectors: Healthcare insurance, medical devices, and related industries

Sector Growth Drivers

India’s healthcare spend has increased from 2.7% to 3.4% of GDP in the last decade.
Per capita GDP is ~$24,500 (India’s), and as income rises, spending on healthcare grows faster than food, clothing, or other essentials.
India is severely underpenetrated in hospital beds: 0.8 beds per 1,000 population vs. global average ~2.7 beds per 1,000 (27 per 10,000) and developed markets like South Korea with 12-13 beds per 1,000.
Hospitals face supply constraints due to shortage of doctors and nurses, many of whom migrate abroad for better pay.
Government insurance schemes (e.g., Ayushman Bharat) exist but pay low rates, limiting hospital profitability.
Healthcare insurance penetration is low but improving, recently made GST-free, which should increase affordability and penetration.

Key Companies & Investment Picks

Healthcare Global Enterprises (HCG)
- Oncology-focused hospital chain
- Market cap ~₹9,500 crores
- Cash flow ~₹320 crores
- Trading at ~30x earnings vs. Apollo Hospitals at 50x
- Oncology patients have high lifetime value (LTV) due to recurring visits
Krishna Diagnostics
- B2G (business-to-government) diagnostic lab operator managing government hospital labs via PPP (public-private partnerships)
- Revenue growth from ₹8 crores in 2011 to ₹700 crores in 2025 (~100x growth)
- Offers high-quality, subsidized diagnostics with advanced equipment at lower prices due to high volume utilization
- Valuation ~10x earnings vs. Dr. Lal Pathlabs at 35-40x
Thyrocare Technologies
- B2B pathology diagnostics, operates in 3,500+ pin codes expanding to 9,500+
- NABL certification rate of 97% (vs. Indian average 2%)
- Focuses on backend processing, partnering with unorganized labs to reduce costs and increase accuracy

Investment Strategy / Portfolio Construction (Aditya Khemka’s Personal Portfolio)

Total capital divided into three main buckets:
- 30% in gold and silver (physical, derivatives, ETFs) as protection against currency debasement
- 30% in his own healthcare-focused equity funds (which have delivered 50%+ CAGR)
- 30% in real estate, real assets, and other funds
- 10% cash liquidity to take advantage of uncertain markets and potential asset calls
Equity allocation is ~40% of net worth, with 75% of equity in healthcare (~30% of total net worth).
Diversification is important despite healthcare being secular growth; also invests in NBFCs, infrastructure, and cement for cyclical exposure.

Macro & Risk Context

Inflation expected to rise in 18-24 months due to liquidity injection, favoring sectors that can pass on costs such as healthcare, consumer staples, oil & gas, and commodities.
Healthcare is recession-proof since demand is inelastic (people will seek healthcare regardless of economic downturns).
Currency debasement risk due to weakening US dollar and geopolitical shifts:
- China has reduced US bond holdings from $1.2 trillion to ~$750 billion, moving funds into gold and silver.
- India (households + RBI) hold 12,000-13,000 tons of gold, potentially making India very wealthy if a gold standard or currency debasement occurs.
- Dollar dominance is challenged by BRICS currency initiatives and local currency trade agreements (e.g., India-Russia).
No international investing; all investments are India-centric due to currency and geopolitical risk and lack of suitable vehicles.

Other Sectors Mentioned

NBFCs and Microfinance Institutions (MFIs) poised for growth as Indian households deleveraged post-COVID and are ready for a credit upcycle.
Education sector is secular but lacks enough publicly listed companies to build a diversified portfolio.

Key Performance Metrics & Financials

Company Market Cap (₹) Revenue / Cash Flow (₹ crores) ROE (%) Valuation (P/E or Cash Earnings) Notes Apollo Hospitals 1 lakh crore Cash flow ₹2,100 crores ~17% ~50x Largest hospital chain Torrent Pharma 1 lakh crore - - 7x stock price growth in 10 years Focused on Indian branded generics Krishna Diagnostics - Revenue ₹700 crores (2025) - ~10x earnings B2G diagnostic lab operator Thyrocare Technologies - - - - 97% NABL-certified labs

Methodology / Investment Framework

Focus on secular growth sectors with structural tailwinds (healthcare, education, NBFCs).
Identify subsectors and companies with:
- Strong growth potential (e.g., hospitals, diagnostics, API/CDMO).
- Competitive advantages (e.g., specialization in oncology, B2G/B2B models).
- Attractive valuations relative to growth and peers.
Multi-asset allocation for risk management: gold/silver as inflation hedge, real estate as real asset, cash for liquidity.
Avoid over-concentration; diversify across sectors and asset classes.
Prefer companies focusing on their core competency rather than trying to do everything.
Invest with a long-term horizon (5 decades runway in healthcare).
Consider macroeconomic and geopolitical risks, especially currency debasement and inflation.

Explicit Recommendations / Cautions

Healthcare is undervalued and underappreciated in India’s equity markets, presenting a unique opportunity.
Inflation will rise, favoring sectors with pricing power like healthcare.
Currency debasement risk justifies holding significant gold and silver.
Healthcare insurance penetration needs to improve for sustainable sector profitability.
Talent shortage in healthcare (doctors, nurses) is a bottleneck and a risk factor.
Sector rotation still relevant in cyclical sectors; secular sectors like healthcare require substantial but not exclusive allocation.
Avoid international equities due to currency and geopolitical risks.

Assets, Tickers, and Instruments Mentioned

Stocks / Companies

Sun Pharma (Sunfarma)
Dr. Reddy’s Laboratories (Dr. Eddies)
Cipla
Torrent Pharma (Torrent Farmer)
Apollo Hospitals
Healthcare Global Enterprises (HCG)
Krishna Diagnostics
Thyrocare Technologies
Dr. Lal Pathlabs

Sectors

Healthcare (subsectors: branded generics, unbranded generics, hospitals, diagnostics, API/CDMO, insurance, medical devices)
NBFCs and Microfinance Institutions (MFIs)
Education (limited listed opportunities)
Consumer Staples
Oil & Gas
Commodities (steel, aluminum)

Assets

Gold and Silver (physical, derivatives, ETFs)
Real Estate
Cash / Liquidity

Presenters / Sources

Aditya Khemka – Chief Investment Officer, InCred Asset Management, healthcare sector specialist with 50%+ CAGR track record.
Host: Name not explicitly mentioned; referred to as Shahan or Sharon in conversation.

Disclaimers

Not explicitly stated as financial advice but framed as personal investment strategy and views.

Emphasis on personal circumstances influencing asset allocation.

Acknowledges unpredictability of macro events and inflation timing.

Encourages long-term investment horizon and diversification.

Summary

Aditya Khemka presents a compelling case for Indian healthcare as a secular, high-growth, undervalued sector with structural tailwinds driven by rising incomes, underpenetration, and demographic trends. He highlights specific subsectors (hospitals, diagnostics, API/CDMO) and companies with strong growth and attractive valuations.

His personal portfolio balances healthcare equity (30%), gold/silver (30%), real assets (30%), and cash (10%) to manage inflation and currency risks amid geopolitical uncertainty. He advises caution on inflation, currency debasement, and talent shortages but remains bullish on healthcare’s multi-decade growth runway.

Other sectors like NBFCs and education are also noted but less investable currently. The conversation blends micro company analysis with macroeconomic and geopolitical context, offering a multi-dimensional investment framework focused on India.