Rahul Guha has a straightforward mandate at API Holdings, the promoter of PharmEasy and Thyrocare - turn India’s largest digital‑health platform away from its cash‑burn era towards profitability.
Since taking charge as MD & CEO of API Holdings in August, Rahul Guha is pivoting the group from growth-at-any-cost to profit-first execution, tightening costs, rejigging capital, and pushing higher‑margin products and services across the ecosystem.
Guha, who also heads the group’s profitable diagnostics arm Thyrocare Technologies Ltd., is not new to the system. For over a year, he has been heading operations at API Holdings, where he was overseeing integration and coordination across the group companies, trying to unlock synergies.
By the first half of FY26, Guha says the group turned EBITDA‑positive (ex‑ESOP), with the goal of full‑year EBITDA profitability and PAT positivity (ex‑Thyrocare) by March 2027.
“Our overall vision is to build India’s best digital health platform,” Guha told Moneycontrol in an interview. “But my first priority is to get the group back on a profitability path.”
Guha added that IPO plans and potential reverse merger with Thyrocare will come into picture once the profitability target is met and needless to say, reverse merger only with the support of Thyrocare minority shareholders.
API Holdings is backed by diverse investor base including institutional investors like Temasek, TPG, and Prosus, alongside investors such as MEMG, a family office run by Ranjan Pai and EvolutionX, among others. MEMG is the largest investor with around 8 percent stake.
API Holdings closed FY25 with Rs 5,872.2 crore in revenue, narrowing its EBITDA loss to Rs 179.1 crore and net loss to Rs.1,572 crore. In sharp contrast, Thyrocare remained the profit engine, delivering Rs 687.5 crore in revenue, Rs 90.75 crore in PAT and sustaining industry-leading margins of 33–35 percent. Together, the group commands roughly 30% of India’s online pharmacy market, alongside Tata 1mg and Apollo.
Balance sheet clean-up
One of the major drags on API Holdings, was its high-cost debt. After the 2023–24 rights issue, the group still carried Rs 1,800 crore of very high‑cost, partly dollar‑linked debt. API Holdings in September this year refinanced with Rs 1,700 crore of new NCDs at low double‑digit rates, and sold 10% of Thyrocare for Rs 668 crore, using proceeds to retire debentures and bring net debt to a level the group can service. API Holdings has pledged its entire stake of 60.93% in Thyrocare to fund debt.
“Now our (interest) cost is in the very low double digits… from the high double digit, actually almost in the 20s, to now in the very very low double digit range… and a level of Rs 1,000 crores of debt we can manage.”
He says pledging remains, but the intent is no further stake sales; Thyrocare is the “jewel in the crown.”
Unlocking synergies
Operationally, Guha is driving a "One Group" strategy to unlock synergies between PharmEasy (the consumer-facing platform) and Ascent (the distribution arm). Previously, PharmEasy procured only 40% of its medicines internally, this has surged now to roughly 85%, according to Guha. This integration Guha says has significantly improved gross margins for PharmEasy while optimizing costs at Ascent due to higher volume throughput.
“We are chasing efficiency in our warehousing operations,” Guha stated, highlighting the deployment of automated systems that ensure zero-error billing and real-time inventory visibility for chemists. The company has also rationalized its workforce and shut down unviable pilots, including an omnichannel experiment that suffered from low fill rates and high logistics costs.
PharmEasy focuses on high margin products & services
While competitors rush into the quick commerce segment delivering medicines in minutes, PharmEasy is doubling down on chronic patients—those requiring lifelong medication for conditions like diabetes or hypertension.
Guha argues that for chronic patients, who account for high-volume, recurring orders, savings outweigh speed. "For senior citizens, every rupee saved is a rupee earned," Guha noted, adding that chronic patients are generally willing to wait 24 hours for delivery if it ensures better pricing and availability.
Selling medicines alone is an unsustainable business model, due to the need to offer significant discounts to attract and retain customers, fierce competition from a fragmented offline market, and intense price wars. PharmEasy offers on an average 18 percent discount and spends about Rs 200 on customer acquisition.
Guha says PharmEasy is focusing on higher-margin products and services. The generic drugs' share with better margins, over branded alternatives has increased from about 2 to 3% last year, to 7–8% in the first half of FY26.
The platform is cross-selling high-margin services, roughly 36 percent of users are now loyalty subscribers, and the company is seeing a trend of customers bundling medicine purchases with diagnostic tests and doctor consultations.
Guha said they are focusing new revenue streams, including vaccination at home, elder care services, and a growing private label business that is expanding at over 25%.
“By the end of this year, we will be profitable as a platform. If we can make profit after giving 18% discount, then there should be no questions.”
PharmEasy’s strategy is seeing early signs of paying off despite competition from quick commerce players, it saw 18% growth in H1 FY26, monthly losses down from Rs 50 crore to less than Rs 2 crore.
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