Tag: Dr Lal Pathlabs

Dr. Lal Pathlabs gets a double upgrade from Kotak Institutional after ‘prolonged underperformance’

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Dr. Lal Pathlabs, the diagnostics services provider has received a double upgrade from Kotak Institutional Equities to “Add” from its earlier rating of “sell” after what the brokerage calls, a “prolonged period of underperformance.”

The brokerage has also increased its price target on Dr. Lal Pathlabs to ₹2,360 from ₹1,975 earlier. The revised price target implies a potential upside of 8% from last Friday’s closing levels.

Kotak Institutional Equities conducted a pricing exercise across seven cities which is indicating a further improvement in pricing trends for the diagnostic players.

“Even as the pricing differential of listed incumbents with online players stays elevated at 2x-2.6x, an increasingly benign competitive landscape alleviates any major concerns on structural volume growth and margins of Dr. Lal Pathlabs and Metropolis,” the Kotak Institutional Equities note said.

Shares of Dr. Lal have seen a correction of close to 15% so far in 2024. Kotak attributed that the correction was led by the exit of the company’s CEO. However, the brokerage believes that Dr. Lal has an able leadership team in place with Om Manchanda as MD and the appointment of Shankha Banerjee as CEO, which also provides continuity.

In comparison to a one-year forward price-to-earnings premium of 20%, Dr. Lal is now trading at a discount to Metropolis Healthcare.

While the brokerage has increased Dr. Lal’s price target, it has also raised on Metropolis Healthcare to ₹1,600 but has maintained its “reduce” rating on the stock citing fair valuations.

Shares of Dr. Lal Pathlabs are currently trading 5% higher at ₹2,234. As of Friday’s close, the stock was still 23% below its recent peak of ₹2,767.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal PathLabs appoints Shankha Banerjee as CEO, effective May 21

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Dr Lal PathLabs Limited has named Shankha Banerjee as its new Chief Executive Officer (CEO) and Key Managerial Personnel (KMP), effective May 21.

According to an exchange filing, Banerjee, with a strong background in sales and marketing, brings extensive experience from his previous roles. A distinguished alumnus of the esteemed Delhi College of Engineering and SP Jain Institute of Management & Research, Mumbai, Banerjee further honed his skills through the ‘BP Sales and Marketing Leadership Development Course’ at Kellogs, USA.

Having joined Dr Lal PathLabs in July 2014 as Chief Operating Officer-Region II, Banerjee has held pivotal roles such as Chief Growth Officer and Chief Operating Officer. Presently, he is serving as Chief Executive Officer-Associates/Group Companies.

Prior to his tenure at Dr Lal PathLabs, Banerjee garnered industry experience during his 14-year tenure at Castrol India Limited & BP Lubricants, where he was the Global Market Space Manager. Subsequently, he held the role of President – Sales & Marketing, Middle East & Africa at Pidilite Industries Limited.

Also Read: Vedanta Aluminium launches ‘Panchhi -Sapno Ka Udaan’ project in Sundargarh, Odisha

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal PathLabs Q3 Results: Net profit rises 53% to ₹81 crore; dividend declared

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Dr Lal PathLabs on Thursday reported a 53% year-on-year (YoY) rise in consolidated net profit at ₹81 crore in the third quarter ended December 31, 2023, compared to ₹52.8 crore in the corresponding quarter of last year.

The healthcare company’s revenue jumped 10% to ₹5,389 crore in Q3FY24, compared to ₹4,894 crore in Q3FY23.

Earnings before interest, tax, depreciation, ammortisation (EBITDA) rose 24.5% YoY to ₹140.6 crore. The EBITDA margins improved to 26.1%.

The company will also pay ₹12 per equity share as the second interim dividend for financial year 2023-24. The record date for the purpose of payment of the second interim dividend will be February 13, 2024.

Shares of Dr Lal PathLabs Ltd were trading 0.25% lower at ₹2,511 apiece on the NSE. The stock has risen over 20% in the last one year.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal PathLabs says pricing pressure in diagnostics is now over

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The diagnostics sector is witnessing a welcome shift as it emerges from a period of intense pricing pressure. This change has paved the way for Dr Lal PathLabs to achieve improved margins, the company’s Managing Director, Om Manchanda told CNBC-TV18 in an exclusive chat.

“We achieved 24% margins during a period of intense price competition, which has substantially eased now,” he said.

The diagnostics industry has been facing scrutiny from analysts over concerns regarding escalating competition within the sector. In October, global investment bank, Goldman Sachs downgraded Indian diagnostic companies on account of rising competition and stretched valuations.

Goldman took a ‘negative’ stance on the sector and said it was turning bearish on B2C (business-to-consumer) incumbents in the space.

Although the company has reported healthy margins recently, there is an expectation of a traditional decrease in the latter half of the year. The company’s leadership is also bracing for a potential tapering of margins in the coming months.

Also Read | Why Saurabh Mukherjea thinks these two diagnostic stocks are little champs— explained

On Thursday, November 2, the diagnostics player reported a 52.4% year-on-year (YoY) rise in consolidated net profit to ₹109.3 crore for the July-September quarter of the current financial year.

Revenue was at ₹601 crore, up 12.6% from the year-ago quarter.

The EBITDA (earnings before interest, tax, depreciation, and amortisation) margin was at 29.6% against 26.9% in the year-ago period.

Manchanda attributed the expansion in the current quarter margin to a combination of factors, with price increases being a strategic move, albeit a last resort for the company. He emphasised the role of a good product mix in bolstering margins, alongside careful pricing strategies.

Looking ahead, the company is targeting an 8-9% CAGR (compound annual growth rate) volume growth, in line with its historical growth patterns.

Dr Lal PathLabs, headquartered in New Delhi, is a provider of diagnostic and related healthcare tests, specialising in a wide array of medical diagnostics.

For more details, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal Pathlabs eyeing pre-COVID margin of 26% and confident of achieving it soon too

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

India’s leading diagnostics chain Dr Lal PathLabs Ltd is targeting to get back to its pre-COVID margin level of 26 percent and it feels confident of achieving this goal soon too.

In an exclusive interview with CNBC-TV18, Bharath Uppiliappan, CEO of Dr Lal PathLabs, shared some encouraging insights about the company’s performance and growth trajectory.

“From margin perspective, we have always said that we would like to get back to the pre-COVID margin level, which is about 26 percent, and we feel confident at this stage that we should be able to achieve that soon,” he said.

One of the key highlights of the conversation was the remarkable surge in non-COVID revenue, which witnessed an impressive rise of 9.7 percent.

“We grew the non-COVID revenue by 9.7 percent,” he said.

This indicates a promising trend for the company, signaling its ability to diversify its revenue streams beyond pandemic-related testing.

Additionally, Dr Lal PathLabs observed a commendable growth in non-COVID volumes, which saw an increase of 2.5 percent. This growth signifies a resurgence in demand for the company’s tests and services outside the context of the COVID-19 pandemic.

Looking ahead, Uppiliappan is optimistic about the company’s performance in the second half of the fiscal year 2023-2024, confidently stating that volumes are expected to rebound during this period. This foresight hints at positive market dynamics and an overall improvement in the healthcare industry’s outlook.

The CEO also acknowledged the role of Swasthfit, an integral part of Dr Lal PathLabs’ business strategy, for driving a significant improvement in realisation for the company.

This accomplishment underscores the importance of innovative healthcare solutions and how they contribute to both patient care and financial growth.

Interestingly, Uppiliappan disclosed that the company is actively exploring the potential of Swasthfit, aiming to achieve sales worth a staggering Rs 500 crore.

“We are looking at a Rs 500 crore kind of runrate for this product line which we built from scratch,” he said.

This ambitious sales target demonstrates the company’s strong commitment to investing in and expanding its cutting-edge offerings.

While sharing the company’s strategic plans for growth, Uppiliappan emphasised that they are diligently focused on the seamless integration of the Suburban acquisition, aiming to leverage its potential for mutual benefit. The company had acquired rival diagnostics chain Suburban Diagnostics in October, 2021.

For more details, watch the accompanying video

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal PathLabs says heavy discounts on diagnostics are easing

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Dr Lal PathLabs, a pathology service provider, aims to leverage market expansion in Tier-2 and 3 cities and strengthen its presence in western markets to drive growth as discounting from competition has been reducing.

In an interview with CNBC-TV18, Om Manchanda, MD of Dr Lal PathLabs, said that the feedback from his teams indicates a downward trend in discounting from competitors, adding that new entrants have led to heavy discounting in the industry.

He said, “Pricing in this industry is not national. It varies from city to city and region to region. But the feedback that I am getting from my teams is that the kind of discounting which was happening earlier is much less. So, effectively there is an increase in prices.”

Also Read: Dr Lal Path Labs plans more price hikes to ease margin squeeze

Talking about price strategies, Manchanda said that Dr Lal PathLabs last hiked its prices in February, but only in select portfolios.

When asked about market expansion, he emphasised that a large part of the company’s growth trajectory will be driven by Tier-2 and 3 towns. Dr Lal PathLabs aims to establish a strong presence in these areas, catering to the growing demand for reliable diagnostic services and building long-term customer relationships.

Dr Lal PathLabs is strategically aiming to increase its market share in the western region of India. This move reflects the company’s ambition to leverage its expertise and reputation to expand. “This process is very gradual in nature. So, I would say that over a period of next 3-5 years, we are confident that we will be able to increase our share in western markets,” Manchanda said.

For more details, watch the accompanying video.

Also, catch all the live updates on markets with CNBC-TV18.com’s blog

Also Read: Hospital, diagnostics companies poised for growth in India — these analysts see their strong growth potential in tier-2, 3 towns

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal Path Labs plans more price hikes to ease margin squeeze

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Dr Lal PathLabs, a leading diagnostic and pathology laboratory, made headlines earlier this year when it announced its first-ever price hike in February 2023.

The decision was aimed at improving the company’s revenue per patient. Surprisingly, the price increase encountered minimal resistance, signalling positive prospects for the company’s financial growth.

The company’s ability to adapt to changing market dynamics and introduce value-added services has positioned it favourably in the highly competitive healthcare industry.

With a focus on continuous innovation and delivering exceptional patient care, Dr Lal PathLabs is poised to maintain its upward trajectory in terms of revenue and market share.

In an interactive with CNBC-TV18, Om Manchanda, managing director of Dr Lal PathLabs said the price hike marked a significant milestone for the company.

He said, “For the first time, we took a price increase in February, which is also positive news as we did not see much resistance coming back from the market. So, I would say that our ability to take price increase is much better now than what we were seeing earlier.”

Also Read | Dr Lal Pathlabs Q4 Results: Profit dips to Rs 56.7 cr; co announces dividend of Rs 6 per share

However, the company did not specify what the hike will be or when it will take place.

Talking further about the price increase, Manchanda said one of the key factors contributing to the company’s ability to implement the price hike successfully was the introduction of bundled packages and changes in the service mix.

“So, whether we would be taking another price increase, probably not yet. This has just begun in the month of February. We would wait and watch how it goes. But obviously, some bit of rebalancing is already happening in terms of routine tests and high-end tests over a period, and we will continue to look at these areas as we go along,” he added.

Also Read | BNP Paribas expects double-digit revenue growth in diagnostics space

Therefore, the successful implementation of the price hike and the positive response from patients indicate a promising future for Dr Lal PathLabs.

The company also reported a consolidated net profit decline of 7.5 percent to Rs 56.7 crore in the fourth quarter that ended March 31, 2022 — much lower than CNBC-TV18’s poll of Rs 65.7 crore. The company had reported a net profit of Rs 61 crore for the January-March period a year ago.

Also Read | Kotak Institutional Equities cautious on diagnostic stocks, prefers Hospitals instead

For more details, watch the accompanying video

Also, catch all the live updates on markets with CNBC-TV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here’s why diagnostic shares had their best single-day performance in nearly a year

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Shares of diagnostic firms like Dr Lal PathLabs Ltd., Thyrocare Technologies Ltd., and Metropolis Healthcare Ltd. jumped between 6-11 percent on Wednesday as Covid-19 fears loomed again with a rising number of cases globally.

Union Health Minister Mansukh Mandaviya held a meeting with senior officials on Wednesday to review the Covid-19 situation in India as cases surge in China, Japan, South Korea, Brazil, and also the US.

Head of the Covid-19 taskforce VK Paul said that Covid is not over but citizens do not need to panic and that the government has the capacity and experience to deal with this pandemic. Paul’s words were also echoed by the Health minister who has directed all to be alert and increase surveillance.

However, diagnostic firms maintained that Covid-19 testing is “insignificant” as of now and there has been no change in curve.

Unless there are hospitalisations or severity in Covid-19 cases, lab firms are not expecting the testing to rise. Even if there is a rise in testing, competition is likely to weigh on the Covid-19 testing volumes.

During the quarter ended September 2022, Dr. Lal Pathlabs reported a 91 percent decline in its Covid-19 testing revenue to Rs 21 crore compared with a year ago. For Metropolis, Covid-19 PCR testing revenue fell 84 percent year-on-year to Rs 7 crore during the second quarter, while Thyrocare’s was down 97 percent to Rs 2.06 crore.

Even after a substantial correction, the valuation of these diagnostic companies are still at elevated levels.

For Thyrocare, this is the best single-day performance in nearly a year. Metropolis Healthcare had its best single-day gain in over eight months. Dr Lal’s gains on Wednesday were also the most in a single day for the company since March this year.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here’s why foreign investors are looking for investments in Indian API business

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

[wealthdesk shortname=”Divis Labs” isinid=”INE361B01024″ bseid=”532488″ nseid=”DIVISLAB” sector=”Pharmaceuticals” exchange=”nse”]

The portfolio management services firm, Marcellus Investment Managers doubling its bet on Divi’s Laboratories, one of the top active pharma ingredients (API) manufacturers in India, with regards to the fast emerging opportunities in the bulk drug and custom pharmaceuticals manufacturing space.

“We doubled down on Dr Lal PathLabs through the summer; will hold us in good stead. We are doubling down on Divi’s Lab as we speak, courtesy the API and that will hold us in good stead and that to my mind is investing,” Saurabh Mukherjea, Founder of the firm, told CNBC-TV18.

Talking about APIs, he said, “It is pretty clear that America wants to freeze China out of the whole digital ecosystem, whether it is semiconductors, artificial intelligence. And as a result the foreign investors are keen to see just how much of the API industry, remember China’s API industry is 9-times India size, just how much of that can India grab.”

Therefore, said Mukherjea, the foreign investors are traveling around the country both looking for investments to make and looking for Indian partners in the API.

Even as India has had good capability in API manufacturing, the country’s large drug formulation manufacturing sector has been depending on cheap Chinese imports in the last several years. Though this had significantly narrowed down the investments in the Indian API industry in the recent past, the trend is now getting reversed with most big pharma players either want to find substitutes for China or make direct or indirect investments in Indian API industry for captive use. While several top Indian pharma companies, including Sun Pharmaceuticals Industries, Aurobindo Pharma, Dr Reddy’s Lab, Glenmark among others,  are now making backward integration adding API manufacturing back into their active portfolio, the foreign companies are making indirect investments here or partnering with Indian API companies.

Also Read: Zydus Lifesciences aims to build its specialty pharma business over the next five years

The firm has Divi’s Lab in its largecap portfolio, GMM Pfaudler in midcap and Paushak in smallcap, he said.

For more details, watch the accompanying video

Also, catch all the live updates on markets with CNBC-TV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Dr Lal Pathlabs and Metropolis margins improve as growth returns to pre-COVID levels

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

[wealthdesk shortname=”Dr Lal PathLab” isinid=”INE600L01024″ bseid=”539524″ nseid=”LALPATHLAB” sector=”Pharmaceuticals” exchange=”nse”]

Diagnostic companies Dr Lal Pathlabs and Metropolis Healthcare clocked better margin in the July-September period compared with the previous three months, strictly on the back of non-COVID revenue as sales of pandemic-related tests continued to fall. However, the end-consumer may not see price falls anytime soon. Here’s why.

Though the overall revenue of both companies met Street expectations, investors remained concerned about their prospects in the coming quarters amid higher competition and market saturation.

Both companies saw their profit margins — or the degree to which a business makes money — improve in the three-month period compared with the previous quarter, with revenue from the non-COVID segment.

Their fair quarterly performances come at a time when the industry is faced with price pressure thanks to online aggregators as well as hospital chains and pharma companies taking a slice of the market.

Dr Lal Pathlabs and Metropolis Healthcare have faced price erosion in key routine tests in their non-COVID portfolios, inflation marketing costs.

Analysts see limited room for further improvement in margins of both companies.

Dr Lal Pathlabs is hopeful of maintaining a pre-COVID margin to the tune of 25-26 percent. “That is something which we are constantly working towards on a longer-term basis and that is what we feel comfortable with,” Dr Lal Pathlabs CEO Bharath Uppiliappan told CNBC-TV18.

“This industry has a very high gross margin contribution, the way we look at it, but also a very heavy fixed cost structure. It is not really possible to keep offering very low prices,” he said.

The proportion of revenue Dr Lal earns from non-COVID operations increased in the July-September period compared with the year-ago quarter.

This means that the company’s pre-COVID operations — the portfolio before the pandemic — was the driver behind the company’s highest ever quarterly revenue.

On a year-on-year basis, however, its margin slipped by 200 bps to 26.4 percent.

The Dr Lal management said the numbers are comparable on a sequential — or quarter-on-quarter — basis. “Growth has been broadly in line with what we have seen a couple of years prior to COVID,” Uppiliappan said. 

Dr Lal shares have gained 1.3 percent and Metropolis 4.1 percent in the past one month, a period in which the Nifty benchmark has risen 4.9 percent.

Catch latest market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow