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The new rich are fuelling brand expansion of Titan:
Business, Equities, Markets - October 11, 2022

The new rich are fueling brand expansion of Titan

The new rich are fueling brand expansion of Titan:

There is a lot of latent demand for luxury items from India and high-class people. Titan gets maximum revenue from its jewellery business, which is about 90%  and the remaining 10% from various businesses like watches , eyewear, and perfumes etc. Titan has four jewellery brands under its portfolio. They are: flagship tanishq, working women’s focused mia, online sales portal carat lane, and zoya . This caters to the rich customer base.

Expansion of business:

India anticipates a significant increase in high-end consumers, prompting Tata group’s jewellery unit to triple its zoya-branded stores by 2027.In the next five years, these stores will be expanded to a total of 15.which will cost around 3.64 million per store. Further revenues from the jewellery business could have the benefit of 80-90 basis points because, of that rest, all businesses have performed well.

India is already the world’s second largest market for the consumption of gold. During the COVID period, there was a disruption in the golden harvest related pieces, but now the business is doing very well and going forward. The company has just opened its second new store of fast rack eyewear, especially to address the youth segment, and tanishq has added 78 stores to its retail footprint, bringing the total number of stores to 582. The company’s aim is to take that number to 700 over the next couple of years. Carat Lanes handcrafted silver jewellery brand Shaya opened its first-ever physical stores in Mumbai and Bengaluru.

company has also plans to accelerate its international expansion in Zoya with Tanishq. Further, the CEO of the jewellery division said that they will utilise this experience to plan a global move for Zoya. Zoya has a collaboration with the Indian hotel company, Taj Hotels, Resorts, and Palaces, etc. and bespoke jewellery made with the design team and artisans. It will attract wealthy clients. Company is also aiming to incline up abroad extension in zoya in a offer to build a global luxury brand.

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Zee -sony merger could change the business trajectory.
Business, Equities, Markets, Uncategorized - October 10, 2022

Zee -sony merger could change the business trajectory.

Zee -sony merger could change the business trajectory.

The competition commission of India (CCI) granted the Zee and Sony conditional approval.The CCI approved the merger of Zee Entertainment Enterprises Ltd with Sony Pictures Networks India pvt Ltd and Bangla Entertainment Pvt Ltd, both part of the Sony group corporation, accepting the modification proposed by the companies to the deal they had announced.

CCI stated that the proposed combination relates to the amalgamation of each Zee and BEPL with and into CME. and preferential allotment of certain shares by CME to Sun Bright International Holding pvt. Ltd. and Sun Bright Mauritius investments ltd.Further, CCI has said that the merger between Japanese company Sony and Indian company Zee Entertainment could hit India’s domestic market.

In terms of viewership share, Zee and Sony have a combined entity share of less than 40% across genres, with the exception of movies, where the merged company has a share of more than 50%.and zee and Sony have a combined total TV viewership share of around 24 percent, slightly higher than Disney Star’s (20 percent).When it comes to advertising , Zee and Sony as a combined entity will command an ad revenue market share of 27 percent, which is largely on par with the Disney star that has a TV ad market share of 26.5 percent as of FY21.

Conditional Nod:

The conditional nod from CCI comes over a month after it was reported that the anti-trust watchdog have flagged the potential adverse effects arising from the merger. The merger, which would create a $10 billion television conglomerate, has the potential to harm competition by providing unparalleled bargaining power.

The board had said that Sony will hold a 50.86% stake in the merged entity, the promoters of Zee will hold 3.99 % , and the other zee shareholders will hold a 45.150% stake in the combined company. The zee-Sony combined entity linear channel portfolio would comprise a wide array of genres and languages with 75 channels. The companies’ combined revenue was Rs 133bn in FY21. which include network and revenue market share of 27% and 37%, respectively.

Financial highlights:

According to Sony, the merged company will create extraordinary value for Indian consumers and will eventually lead the consumer transition from traditional pay TV to the digital future.Zee and Sony will bring tremendous synergies between the two companies that will exponentially grow the business and the sector. While the OTT entertainment market has grown to nearly Rs 100 billion, with Rs 43.5 billion in subscription revenue derived from 53 million subscriptions and 29 million unique subscriptions,

The zee and Sony OTT apps, while performing modestly individually, have double-digit revenue and subscriber market share on a combined basis. The combined operating cost of Rs 30bn is similar to that of the top OTT platforms . assuming it could match the top entertainment apps in the original content generation space. Zee lacked the strength to compete with the top OTT platforms individually; the combined entity has the potential to create a strong foothold and content slate with a war chest of Rs 113bn capital infusion from Sony post merger and potential cash generation of Rs 50bn from the linear business.The only thing where the company is lacking in sports is the bidding for the next 5 years of broadcasting rights for the IPL.

According to experts, this merger will create a 10bn dollar TV enterprise. this will create the largest entertainment network in India with a 26 percent viewership share and could become a one of the serious competititor to replace market leader star and Disney.

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lupin ltd.
Business, Equities, Markets, Research, Result Updates - October 3, 2022

Lupin ltd consolidated revenue fell by 14% YOY to Rs 3604 Cr.

In Q1FY23, Lupin ltd consolidated revenue fell by 14% YOY to Rs 3604 Cr.

Lupin limited is a multi-national pharmaceutical company based in Mumbai. The company specialises in branded and generic formulations, APIs and advanced drug delivery systems in biotechnology. It has 18 manufacturing sites and 9 R&D sites across the globe.

Lupin ltd consolidated revenue fell by 14.9% YOY to Rs 3604 Crores, in Q1FY23, due to subdued performance of its US business.EBITDA was down by 76% YOY to Rs 238 Crores. EBITDA margin falls by 1680 basis points.YOY to 6.6% due to raw martial inflation, higher employee spends and other expenses. Consequently , company reported a loss of Rs 89 Crores. As against of Rs 542 Crores profit a year ago. Company increasing market share, new product ,and scaling up of the Indian business indicate well for the company  performance.

Financial highlights :

In Q1FY23, lupin ltd consolidated revenue declined by 12.3% YOY and QOQ to Rs 3.74Crores.it is mainly due to muted performance in the US business. Revenue from the US business declined by 24.2% YOY and 28.7%Quarter On Quarter to Rs 1010 Crores due to inventory writw down , shelf stock adjustments and price erosion. Company s Indian revenue stood at Rs 1492 Crores which is down by 8.85 YOY and up by 10.4% QOQ DRIVEN BY A 9.9% Quarter on quarter driven by a 9.9 % QOQ growth in domestic formulations. API revenue grew by 3.7% YOY and 15.8% QOQ to Rs 255 Crores. While revenue from growth markets rose by 27.3% YOY and 11.2% QOQ to Rs 424 Crores.

Margins impacted due to raw material inflation:

Gross margin of company contracted by 720 basis points YOY to 55.3% as the company pared down inventories and took shelf shock adjustments on select products consequently; EBITDA fell by 76% YOY to Rs 238 Crores. Company owing to further price erosion in the US business and inflation in input materials. EBITDA margin thereby shrink  by  16.8% YOY to 6.4% reported a loss stood at Rs 89  Crores as against Rs 542 Crores .

Quarter highlights:  

Capex stood at Rs 161 Crores against Rs 106 Cr in Q1FY22 and Rs 158 Crores in Q4FY22. R&D expense was at Rs 348 Crores against Rs 374 Crores in Q1FY22 And Rs 344 Crores in Q4FY22. Total marketed generic products stood at 167. It launched cyclosporine ophthalmic in the US in the quarter. Current pipeline includes 54 FTF, OF Which 21 exclusive FTFs are awaiting for the USFDA approval. In India business, the company has a revenue run rate of more than Rs 1000 Crores. In cardiac and anti-diabetics .GI, pain and gynae grew in double digits.

Valuation:

The EPS was Rs. -1.96, compared to Rs. 10.15 in June 2021. The ROCE and ROE were at  -7.16% and -11.8%, respectively. The book value of a stock is Rs 267. The company’s asset turnover ratio was 0.73x. The scrip is trading at Rs.717, up by 5.40%. on Monday.

Astral Pipes posted a net profit of Rs. 96 Cr.

 

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The Cabinet okays a Rs 10,000 Crore futuristic revamp of three major railway stations.
Business, Editorials, Equities, Markets, Research - September 30, 2022

the-cabinet-okays-a-rs-10000-crore-futuristic-revamp-of-three-major-railway-stations

The Cabinet okays a Rs 10,000 Crore futuristic revamp of three major railway stations.

The union cabinet meeting, which is chaired by the hon. prime minister, Narendra Modi, have gave approval for the redevelopment of 3 major railway stations with a total investment of Rs 10,000 crores. Further, union minister of railways Ashwini Vaishnaw has said that the stations will be develop with a futuristic design.
1. New Delhi railway station
2. b] The railway station in Ahmadabad, as well as
3. c] Mumbai’s Chhatrapati Shivaji Maharaj Terminus [CSMT].
A railway station is an important and central place for any city. PM Shri Narendra Modi has given importance to station development in the transformation of railways by using green building techniques method with solar energy, water conservation, recycling and improved tree cover. cabinet decision gives a new direction to the station dev.,work on development of 199 station on and from these tenders have been issued for 47 railway stations. For the remaining stations, the master planning and design is in progress. Work progression is fast for 32 stations and the cabinet has sanctioned an investment of Rs 10,000 crores for 3 big stations, namely New Delhi, CSMT Mumbai and Ahmadabad.

The components of railway station design will be:

Every station will have a spacious roof plaza of [38/72/108m] with all the passengers’ amenities in one place, along with spaces for retail, cafeterias, and recreational facilities..
Both sides of the city will be connected to the station, and with the station building on both sides of the railway tracks.

Facilities like food courts, waiting lounges, playing areas for children , and places for local products, etc. will be available.

To make stations comfortable , there will be a proper illumination , way finding, signage, acoustics, lifts, escalators, and travelators.

A detailed plan have been prepare for the smooth movement of traffic with adequate parking facilities.

There will be corporations for transportation like metro, buses, etc.

Green building techniques will be use in stations redeveloping with solar energy, water conservation, and recycling and improved tree cover.

Special care will be taking to provide Divyang with friendly facilities.

This stations will be built on the concept of elegant building.

There will be segregation of arrivals and departures, clutter-free platforms, improved surfaces, and fully covered platforms.

All stations will have a CCTV installation with remote access.

development benefits:

These will be iconic station buildings. However, shifting from the earlier stance, the ministry will no longer be looking at station redevelopment on a public–private partnership [ppp] basis, the minister said. The 3 stations will be develop completely through budgetary means, he added. The projects will be tendered out through the engineering procurement and construction [EPC] mode. This comes from the ministry had earlier floated a tender for the redevelopment of Chhatrapati shivaji maharj terminus under the build-operate-transfer [BOT] MODE. A form of PPP.

The benefits of the EPC mode are that it results in the creation of 35,744 new jobs; it improves the daily experience of more than two million travellers; it also helps the local economy through investment and additional business opportunities; and it promotes transit-oriented development of cities.

The development assumes significance with respect to the monetisation plans of the railway ministry , which is the second highest contributor to the centres The Rs 6 trillion national transportation .Further, Vaishnaw said that the Delhi station will take around 3.5 years to complete as it involves complex operational changes, and the other two railway stations, Ahmadabad and CSMT Mumbai, will be ready in 2.5 years. The redevelopment of the stations is to be complete in a time span of approximately 2–3.5 years.

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Astral Pipes posted a net profit of Rs. 96 Cr.
Business, Editorials, Equities, Markets, Research - September 17, 2022

Astral Pipes posted a net profit of Rs. 96 Cr.

Astral Pipes posted a net profit of Rs. 96 Cr.

Astral posted consolidated revenue growth of 73.2% YoY in Q1FY23, majorly led by growth in plastic and adhesive. In the plastics segment, the company reported volume growth of 48.5% YoY, which was on par with the industry growth, indicating that Astral gained market share in the plumbing segment. The company’s gross margins fell by 717bps YoY due to a fall in PVC prices, leading to an inventory loss of Rs 25 Cr. The raw material and PVC prices are falling continuously and reached Rs 102/kg in July ’22 from Rs 120/kg in April-Jun 22. The company’s EBITDA margins fell by 433bps YoY due to a fall in its gross operating profitability. However, its reported PAT grew by 27.0% YoY at Rs. 96 Cr. as compared to sales due to a fall in operating profitability.

Volume expansion to boost growth:

Astral has reported volume growth of 10% in the piping segment, the highest among peers in the last 4 years. This reflects that Astral is gaining market share in the plumbing segment. The raw material and PVC prices have been falling continuously, which would help in improving the gross margins of the company after inventory is stabilised. Astral could deliver consolidated margins in the range of 17% to 18% in the upcoming quarters. Furthermore, Astral’s foray into valves, resins, sanitary ware, and tanks would add revenue growth in the upcoming years.

The company estimates that newly launched products and segments, including tanks, drain-pro, ball-valve, sanitary ware and faucets, and paint business, will be able to generate revenue of Rs 1,500 Cr over the next 5 years. Astral has invested Rs 1,000 crores in capex over the last five years, with the funds being used in the coming years. Therefore, the company is confident that it will be able to grow not only in its existing product portfolio but also accrue additional revenue of Rs 1,500 Cr in the next 4–5 years by leveraging its new products and categories. In April ’22, the company entered into a definitive agreement to acquire a controlling 51% stake in the operating business of Gem Paints Private Limited. ‘Gem’ paints have been manufacturing industrial and decorative coatings in South India.

Valuations:

The EPS was Rs. 4.42, compared to Rs.3.68 in June 2021. The ROCE and ROE were at 29.6% and 22.6%, respectively. The stock was trading at a P/E ratio of 94.3x. The company has an asset turnover ratio was 1.45x.The scrip is trading at Rs.2339, down by 6.65% on Friday.

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Kaveri Seeds reported a net profit of Rs. 240 Cr.
Business, Editorials, Equities, Food, Markets, Research - September 16, 2022

Kaveri Seeds reported a net profit of Rs. 240 Cr.

Kaveri Seeds reported a net profit of Rs. 240 Cr.

Kaveri Seeds reported consolidated revenue increased by 9% YoY to 690 Cr., led by higher cotton acreage and improved volumes. The EBITDA, at 250 Cr., improved by 18.3% YoY, while PAT grew 19.1% YoY to 240 Cr. The EBITDA margin improved to 37.1%. Cotton volumes increased by 8.3% YoY while revenue fell by 3.8%. The non-cotton volumes improved by 9.8% while revenue increased by 10% YoY. The company intends to improve volume and revenue for the rest of FY23 with double-digit growth in this segments.

Volume growth aids the topline:

The use of illegal cotton seeds has come down as organised players have gained market share in the cotton seed segment, which has also led to an increase in revenue. The new product launches continued in the quarter as the company introduced newer products across all segments. The new products in the North American market include KCH111, VIPLAV, Money Maker, and KCH 9333. The selected rice volumes grew by 15.2% in FY23. Hybrid rice volumes increased by 6.1% and revenue by 1.0%. The introduction of new hybrids such as the 425, 471, 729, and 473 fueled the segment’s rapid growth. The vegetable seed sales volume increased by 25.9% while revenue decreased by 2.5%. The company is expecting double-digit growth in maize, sunflower, vegetables, and rice in the second half of the year. Farmers’ sentiment has also been influenced by the delay in the onset of the monsoon across India until mid-June.

The company continues to see encouraging growth in vegetable seed acreage, revenue growth, and volumes. The overall exports of KSCL have contributed to 19 Cr. in revenues. The management expects exports to contribute a significant share in the next year. The high market shares and cotton prices drove increased cotton acreage during the current year. Increased competition in the cotton segment led to muted growth due to smaller companies with low realisations crowding the market, which will eventually result in lower overall realisations and higher discounts given during the quarter. The price of cotton per packet was up by 40 YoY.

The company remains confident that discount reversals will happen next year due to lower illegal BT cotton share and overall better market sentiment, despite not being able to realise prices. There is a decrease in acreage due to rain shortages. The higher prices will result in more acres in the cotton crop, which is a major risk for the company.

KSCL’s earnings seem to have normalised and are likely to improve for the rest of FY23. The contribution from the non-cotton segment is improving, and the division is expected to post double-digit growth. The leadership position, R&D focus, healthy product pipeline, presence across crop categories and strong distribution network will act as key levers for growth over the long term. The increasing contribution from the higher-growth projected non-cotton segment will aid the performance. There is a decrease in acreage due to rain shortages. The higher prices will reduce acres in the cotton crop.

Valuations:

In June 2022, the EPS was Rs. 41.27, compared to Rs. 33.44 in June 2021. The ROCE and ROE were at 17.1% and 16.3%, respectively. The stock was trading at a P/E ratio of 10.9x. The company is debt free, and the asset turnover ratio was 0.48x. The scrip is trading at Rs.461, down by 3.05% on Friday.

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Tarsons Products earned Rs. 29 crores in net profit.
Business, Editorials, Equities, Markets, Research - September 16, 2022

Tarsons Products earned Rs. 29 crores in net profit.

Tarsons Products earned Rs. 29 crores in net profit.

On the high COVID-led base for Q1FY22, revenues fell 0.4% year on year. The total revenue was Rs 85 Cr and the net profit was Rs 29 Cr on a consolidated basis. The company reported a standalone revenue of Rs. 69 crore and a net profit of Rs. 20 crore.The operating profit was recorded at Rs. 44 Cr., with a pre-tax income of Rs. 39 Cr.

Margins shrink.

Domestic business fell around 6% YoY and 20% QoQ. The sequential decline was due to seasonality, with Q1 tending to be the weakest quarter. The company took a price hike in Q1FY23, which will begin to reflect in the next few quarters. The export business grew 11.1% YoY. This, coupled with elevated raw material prices, resulted in dragging gross margin down by 280bps YoY to 79.1%. The SG&A expenses grew 20.7% YoY, led by higher freight and promotion expenses. As a result, the EBITDA margin fell 760 basis points year on year (-680 basis points quarter on quarter) to 45.4%. The company expects to maintain healthy margins in the coming years thanks to improved product mix, increased contribution from new products, and in-house sterilisation, partially offset by higher costs associated with the start-up of new plants.

The PCR has received a good response from the customers in terms of quality. Specialised resin prices have stabilised, whereas packaging and paper costs have started declining. The revenues will be driven by growth in both domestic and export markets. We expect the company to maintain healthy margins in the coming years. The increased market share and strong growth in end-user industries will benefit the company. The major risk for the company is intensified competition and disruption in the distribution network.

Valuations:

The EPS was Rs. 5.54. The ROCE and ROE were at 35.3% and 27.4%, respectively. The stock was trading at a P/E ratio of 46x. The debt-to-equity ratio was 0.04x, whereas the asset turnover ratio was 0.72x. The interest coverage ratio stood at 33x. The scrip was trading at Rs.870, up by 1.02% on Thursday.

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Control Print declared a strong set of Q1FY23 results.
Business, Editorials, Equities, Markets, Research - September 16, 2022

Control Print declared a strong set of Q1FY23 results.

Control Print declared a strong set of Q1FY23 results.

The key highlight for the quarter was higher gross and EBIDTA margins YoY and QoQ on account of better product mix. The revenues grew by 19.7% YoY to 65.1 crore. Gross margins expanded QoQ by 440 bps to 63% vs. 58.7% in Q1FY22, which was mainly on account of a higher share of consumables in the overall revenues. which also led to EBIDTA margins coming in at 27.3% in Q1FY23 vs. 23.7% QoQ and 21.7% YoY. The PAT came in at 11.7 crore, up 105% YoY.

Strong financials:

The company, as of FY22, has an installed base of more than 15,000 printers. The consumable goods saw good traction during the quarter, while building materials, pharmaceuticals, and bearings also expanded their base. The company suffered a bit due to chip shortages and supply chain issues, but things will get back to normal in the coming 1-2 quarters. Dairy, healthcare, packaged food, cable, and FMCG also provided good contributions to business. The company is now focusing on developing software for customers so they can provide customized support to them. Telecalling is also helping companies acquire new customers. Imported raw materials account for 25-27% of total imports.The company has sold around 756 printers, of which CIJ printers are dominating the quantity with over 55–65% of the total share. The company is enjoying a higher installed base for printers as during COVID, printers’ sales were good. They offer seven different types of printers, of which CIJ and TIJ are the most common. The higher percentage of consumables in revenue resulted in higher gross and EBITDA margins. The current utilization level stands at 55-60 companies per hour. Capacity can be increased as needed.

Valuations:

The EPS was 7.40 rupees. The ROCE and ROE were at 18.8% and 15.3%, respectively. The stock was trading at a P/E ratio of 18.5x. The asset turnover ratio was 0.84x. The interest coverage ratio stood at 47.7x. The scrip was trading at Rs.486, up by 1.06% on Thursday.

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Krishna Institute reported a net profit of Rs. 79 Cr.
Business, Editorials, Equities, Health, Markets, Research - September 16, 2022

Krishna Institute reported a net profit of Rs. 79 Cr.

Krishna Institute reported a net profit of Rs. 79 Cr.

KIMS reported a net profit of Rs. 79 Cr., and decrease from Rs. 83 Cr. in March 2022 and Rs. 92 Cr. year on year. The revenue in Q1 FY22-23 increased to Rs. 459 Cr from Rs. 372 Cr in March 2021 and Rs. 473 Cr in June 2021. The operating profit was Rs. 137 in the current quarter versus Rs. 114 Cr. in the March quarter.

The expansion will be done using a cluster-based approach.

KIMS has entered into a definitive agreement to acquire a 51% stake in Kingsway Hospitals, Nagpur. This is one of the largest private multi-specialty hospitals in Nagpur, promoted by the Sancheti family and a few eminent doctors. The hospital was commissioned in 2019 with a 334-bed capacity, expandable to 500 beds. KIMS will pay upfront Rs. 800 crore for its 51% stake, which will be used to repay existing debt. After this infusion, the JV will still be left with Rs 150 Cr of debt.

Acquisition cost works out to be Rs 90 lakh/bed.

The acquisition cost works out to be Rs 90 lakh/bed. The acquisition will be completed by Sept. Assuming the operating leverage plays out, Kingsway hospital will have 250 operational beds with a 53% occupancy. For FY22 and FY23 (4 months), Kingsway generated Rs. 1700 Cr. and Rs. 47,500 Cr. of revenues, respectively. ARPOB stands at Rs 29,000/day and has turned EBIDTA positive within 3 years of operation.

KIMS management intends to enhance occupancy from current levels, as well as bring operational efficiencies and synergies. The Kingsway hospital’s COGS stands at 28-29% of sales versus KIMS’s 22% of sales. The management sees profitability scaling up from current levels and reaching 15-20% OPM over the next 2-3 years. KIMS currently has net cash of Rs 200 Cr. and thereby, the Kingsway acquisition will be funded through internal accruals. Currently, the payor mix stands at 80%, comprising of cash plus insurance.

The management, in its cluster-based approach, is looking forward to replicating the AP and Telangana models in the Maharashtra and Karnataka regions. KIMS plans to commercialise 1500 beds over the next 4–5 years across Maharashtra and the Karnataka region. The expansion will be a combination of inorganic and greenfield expansion. More importantly, the company will partner with local doctors and consultants in specific micro-markets to generate better footfalls and achieve a faster breakeven. KIMS will have full control of decision-making in such a partnership.

Valuations:

In June 2022, the EPS was Rs. 8.74, compared to Rs. 10.08 in June 2021. The ROCE and ROE were at 14.8% and 15.6%, respectively. The stock was trading at a P/E ratio of 31.7x. The debt-to-equity ratio was 0.18x, whereas the asset turnover ratio was 0.99x. The interest coverage ratio stood at 29.5x. The scrip is trading at Rs.1241, down by 0.2% on Wednesday.

Dr. Lal Pathlabs reported a net profit of Rs. 58 Cr.

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Business, Editorials, Equities, Health, Markets, Research - September 16, 2022

Dr. Lal Pathlabs reported a net profit of Rs. 58 Cr.

Dr. Lal Pathlabs reported a net profit of Rs. 58 Cr.

Dr. Lal Pathlabs reported a consolidated net profit declined 57% to Rs 58 crore for the first quarter June 30. The company had reported a net profit of Rs 134 crore in the April-June period of the last fiscal. The revenue from operations declined to Rs 503 crore in June 2022 from Rs 607 crore in June 2021. In Q1FY23, DLPL served 69 million patients and collected 180 million non-Covid-19 samples. The company declared an interim dividend of Rs. 6/share.

The diagnostic sector will experience tremendous growth.

Dr. Lal PathLabs reported healthy core business performance, driven by increased penetration, digitalization, enhanced testing facilities, and increased home sampling. Swasth fit contributed to 21% of total revenue; packaged tests accounted for 30% of sales. The company targets pre-Covid-19 level growth of 13-15% over the year and strives to double its volumes over 2-3 years.

The Indian diagnostic sector holds significant growth potential, as was evident by the industry’s response to the pandemic, and organised national brands have met these challenges without raising prices. The industry has seen the entry of many new competitors and the growth of the organised sector, both due to overall market growth as well as an accelerated shift from the unorganised to the organised segment.

The customers appreciate the certainty of quality and effectiveness that Dr. Lal PathLabs provides, which the unorganised players will not be able to successfully deliver. In the future, they will build and drive growth through organic expansion of lab and collection centre infrastructure, inorganic expansion, use of technology to improve customer experience, and provision of value-added services at one level while driving internal process efficiencies at another level to achieve productivity. On the organic front, the initiative of the creation of Hub Labs has started yielding good results, especially in the northern part of India. This will also give the capability to go deeper into Tier-II and Tier-III towns in large states like UP, Bihar, etc.

Valuations:

Dr. Lal Pathlabs, EPS was at Rs.6.2 in June 2022, down from Rs.15.74 in June 2021. The ROCE and ROE were at 29.4% and 25.1%, respectively. The stock was trading at a P/E ratio of 73.4x. The debt-to-equity ratio was 0.35x, whereas the asset turnover ratio was 1.04x. The interest coverage ratio stood at 12x. The scrip is trading at Rs.2389, down by 1.89% on Wednesday.

Everest Kanto reported a total revenue of Rs. 380 Cr.

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