Health care is a long game
For many Singaporeans, Raffles Medical a common name. The healthcare group has built a reputation as one of Singapore’s leading private healthcare providers.
But behind the scenes, the company has spent the last decade chasing a much bigger ambition.
Rather than remaining a Singapore-focused healthcare provider, Raffles Medical wanted to become a regional healthcare brand — with hospitals and clinics spread across Asia.
It was a bold strategy. And the it is expensive one.
In 2016, the group announced plans to invest around S$600 million to expand overseas, building hospitals and clinics overseas with China as its biggest bet.
Today, however, those investments have not yet translated into equally impressive financial returns. While its Singapore operations are stable and profitable, its major investment in China continues to lag.
Why China looked like an obvious market
Back in the mid-2010s, expanding into China seemed like a logical move.
The country’s population was aging, incomes were rising, and health care reforms were slowly giving way to private health care providers.
For companies like Raffles Medical, the opportunity looked huge.
The company was not rushing into an unfamiliar market.
According to executives, senior officials had spent more than 30 years watching healthcare reforms in China before deciding the time was right to enter the country.
Instead of stopping at outpatient clinics, Raffles Medical doubled down on its Chinese ambitions by investing in full-service hospitals.
It opened a 700-bed international tertiary hospital in Chongqing in 2019, followed by a 400-bed tertiary hospital in Shanghai in 2021. At the same time, it also upgraded its existing medical center in Beijing to Raffles Hospital Beijing, expanding its services to include inpatients and outpatients.
Together, the projects require years of planning, construction, regulatory approvals, hiring of experts and investment in medical equipment before they can even begin seeing patients.
Unlike retail stores or restaurants, hospitals cannot simply open their doors and expect customers to fill up.
Patients need to trust the product. Doctors need to establish referral networks. Insurance cooperation must be protected. Theatres, diagnostic equipment and inpatient wards all have to be used before a hospital can start generating a meaningful profit.
In other words, health care is a long game.
The investment is huge, but so is the gap
That long game is becoming increasingly apparent in Raffles Medical’s finances.
Ahead of its 2026 AGM, shareholders questioned why the Chinese business has grown so slowly despite years of investment. Between FY2018 and FY2025, revenue from China increased by only S$25.4 million, reaching S$65.4 million.
The difference becomes even more striking when compared to the team’s asset base. China accounts for around 30% of Raffles Medical’s total assets, yet contributes only 10% of the group’s revenue.
In comparison, Singapore’s asset base is 2.2 times larger than China’s, but generates more than 10 times the revenue.
These figures suggest that while Raffles Medical has built up a large presence in China, its overseas assets have not yet achieved the same level of utilization and productivity as its mature Singapore operation.
The company says patience is part of the plan
Raffles Medical does not deny that its operations abroad take time. Instead, administrators argue that’s how hospital investments work.
Building a hospital is not the hardest part—building patient capacity.
The group says overseas operations often need years to develop clinical skills, develop applications and reach sufficient scale before they can be meaningfully profitable.
China has also become a stronger workplace than many expected. The company cited regional tensions, technological limitations and broader economic challenges as factors weighing on its performance.
Still, executives continue to view China as a strategic market, pointing out that nearly 30 percent of the country’s population can already afford high-quality health care, making it a large addressable market.
More importantly, Raffles Medical has gradually gained access to China’s social insurance system, allowing it to treat more local patients instead of relying heavily on expatriates—an important step that could improve patient rates in the long run.
China was the exception, not the rule
Despite more than a decade of overseas expansion, Singapore remains the financial heart of Raffles Medical. By FY2025, the group’s local operations generated nearly 90% of revenue, effectively supporting its regional ambitions while new markets continue to mature.
Not all of its overseas markets, however, have followed the same playbook.
While China has seen Raffles Medical invest heavily in building full-scale teaching hospitals, its expansion elsewhere has been more measured.
In markets such as Vietnam, Cambodia and Japan, the group focuses on outpatient clinics, specialist centers and collaborations with local healthcare providers instead of implementing hospital projects that require the same capital.
That more cautious approach is reflected in its balance sheet. As of FY2025, Raffles Medical’s non-current assets in Greater China stand at around S$304 million, compared to just S$13.4 million for the rest of Asia.
This makes China the group’s biggest regional bet and the market that may decide its international expansion is finally paying off.
So, is gambling worth it?
Investing in hospitals is not like most businesses. It takes years to make a sustainable return, but there are signs that Raffles Medical’s China operations are starting to gain momentum.
In FY2025, both its Shanghai and Chongqing hospitals reported higher patient volumes, while Shanghai also recorded revenue and profit growth. The group also expanded partnerships with leading public hospitals and gained access to China’s National Health Insurance Program at its Shanghai hospital, moves aimed at expanding the local patient base.
However, there is no denying that its funds are still active.
If Raffles Medical is successful in improving utilization and profitability, years of investment could be worthwhile. If not, its China expansion could be an expensive reminder that succeeding overseas is more difficult than replicating a proven business model.
For now, Raffles Medical seems committed to realizing this strategy.
After spending a decade—and hundreds of millions of dollars—building its regional space, turning back isn’t really an option.
- Read other articles we’ve written about Singapore businesses here.
Featured Image Credit: Raffles Medical Group
