Change is coming to a little-known company in Bangalore which manufactures healthcare consumables such as sutures, gloves and mesh that form the backbone of surgeries. For 20 years since its inception, Sutures India has been making wound-care products and steadily expanding its distribution network. Given the unobtrusive medical items it manufactures—most people are ignorant of the life-saving role of sutures—the company would have probably gone unnoticed despite exporting to 95 countries and supplying to 12,000 hospitals in India.
But then it attracted the attention of two private equity firms in two years. First, CX Partners invested about Rs 200 crore in the company in 2012. Next year, in September, TPG Growth—the mid-market and growth equity platform of the global private investment firm, TPG Capital—invested Rs 147 crore.
Expansion and acquisition are on TPG’s mind. In the immediate months after it came on board, it evaluated more than 15 acquisition targets. “We are in discussions with three or four of them for a possible buyout or acquisition. We are evaluating joint ventures with other companies in healthcare that have cutting-edge products,” says Vish Narain, country head of TPG Growth.
A 2014 PwC report values the Indian health care market at $79 billion as of 2012, and predicts a compounded annual growth rate of 12 percent in three to five years. Narain estimates that the Indian wound-care market is about $2 billion, and sutures, or stitches as they are commonly called, have a 15-20 percent share in this space. In 10 years, hospital beds are likely to increase by nearly four million. More beds mean more surgeries and Sutures India is ready to scale up operations.
The Men Behind it
In 1992, Chairman LG Chandrasekhar and Managing Director S Subramanian launched Sutures India with an investment of just a few lakhs. To start with, they manufactured and sold catgut sutures, a type of stitches prepared from animal intestine.
The company’s growth arc mirrors the evolution of sutures in India. Fifteen years ago, most sutures were made from natural materials such as silk and catgut. Over the years, the Indian market became more diverse and moved to stitches made from synthetic materials; Sutures India’s Truglyde is one such example. (The names of almost all its branded products are prefixed with ‘Tru’.)
Sutures India was launched with the mission of producing indigenous but superior surgical products at affordable rates. It achieved success early on in its journey, logging operating profits the very year it was launched. The profits were marginal, but is significant given the crucial, yet understated products it made—stitches that held the body tissues together after a laceration or surgery. Even the most talented of surgeons will find themselves handicapped without sutures, but even the fussiest of patients wouldn’t insist on a particular brand. Sutures were essential, yet invisible.
Over the next two decades, Sutures India expanded its product range: Apart from producing absorbable and non-absorbable sutures, it now manufactures surgical meshes, catheters, tape, gloves, skin staplers and bone wax.