UK healthcare firm Bupa sees strong growth in India

Bupa had said in Jan it was planning to raise stake in JV with Max India to 49%

British private healthcare group Bupa is eager to expand quickly in India's fast-growing health insurance market, once a rule change on foreign investment is implemented, the firm's chief executive said on Thursday.

Bupa, which operates globally and gets 70% of its revenue from health insurance, said in January it planned to raise its stake to a new maximum of 49% in its joint venture with Max India, from the current maximum for a foreign investor in insurance of 26%.

Bupa was the first foreign company to announce plans to raise its holding in an insurance venture after the rule change was announced in late 2014. The bill was passed in India's lower house of Parliament on Wednesday.

"The health insurance market is still quite a nascent market, there is tonnes of headroom for growth," Stuart Fletcher told Reuters by telephone.

"We are doing all the preparatory work to be able to move quickly as soon as the ordinance is turned into statute."

The private medical insurance market in India has been growing at around 15% a year, Bupa said, supported by the country's emerging middle class with an increasing disposable income.

Bupa posted 2014 underlying pre-tax profit of 638 million pounds ($966.91 million) on Thursday, up 8% from a year earlier on a constant exchange rate basis.

Fletcher said there was strong performance in Australia and New Zealand, which makes up 40% of the company's business, and also in Saudi Arabia, where the firm has a minority stake in Bupa Arabia.

Bupa, which has around 2 billion pounds in outstanding debt, did not have short-term plans for new issuance, Fletcher said, though he added: "It's a favourable bond market ... I think we would be favourably received."

The company launched a 350 million pound bond seven-year bond last year with a coupon of 3.375%, currently trading at a yield of 2.7%.

($1 = 0.6557 pounds)