In today’s briefing:
- Dr Lal PathLabs Ltd (DLPL IN): Base Business Recovering; Competition Is the Only Headwind
- BCH: Turning Back to Core Operation Post 1Q22 Peak
Dr Lal PathLabs Ltd (DLPL IN): Base Business Recovering; Competition Is the Only Headwind
- Dr Lal PathLabs Ltd (DLPL IN) reported 35% y/y revenue growth in its non-COVID business in FY22. Non-COVID realization per patient is also back to pre-COVID levels.
- The company has acquired Suburban Diagnostics last year, which will further widen its geographical footprint, with western region contributing 24% of revenue from 10% earlier.
- There is a lot of noise regarding competition in the industry. Thus far, DLPL has not seen much pricing pressure and underpenetrated Indian diagnostic segment can accommodate more players.
BCH: Turning Back to Core Operation Post 1Q22 Peak
- Upgrade to BUY from HOLD rating with an unchanged TP of B21.00, based on 14.36xPE’22E which is close to -2SD of 3-years trailing average.
- We see earnings trend to fall QoQ in 2Q22, as COVID-19 contribution fades in parallel with declining infection patients cases and dropped RT-PCR test for vaccinated tourists.
- We view profit trend to drop HoH in 2H22, as COVID-revenue normalizes YoY off high base in 2H21 based on our expectation government declares COVID as endemic in July.
Before it’s here, it’s on Smartkarma
