All the follow-up queries I got in replies are addrrssed to sm extent in recent con-call; which is why I referred to it and urge others again to go thru it. Running in ur assumptions without checking the facts is sure shot recipe for disappointment. I can address broader themes here, bt again it vl be useful only if good counter points cm up w.r.t the biz( not whr the stock price is nd it deserves that validation)
- Topline growth : –
The growth looks tepid on reported figures bt once u adjust for COVID nd Rajasthan tender earnings, u’ll get the true growth picture of underlying earnings. Khemka saab(Aditya Khemka frm Incred) got these nos. dissected and confirmed from the mgmt.
- Compressed Margins : –
The opex in getting the new centres up nd running is wat’s keeping the margins low\stable at the moment. Nd again, a 25% EBITDA margin in low range is indicator of a good biz model IMO( Moat, No Moat, Commodity, Non-commodity however u classify it)
- Misc : –
B2C diagnostics biz with home collection facility is a different ball game and an altogether diff. logistic setup which the mgmt dont want to dilute thr Focus to.
Lowest cost Moat is also a type of Moat and no harm in pursuing that strategy if the mgmt is confident of execution. Now whn and wat multiple mkt assigns to it is anybody’s call
Patients coming to them directly, thru health schemes, doc referrals etc. all boils down to and can be tracked thru the vol. of tests they’re doing. Nd that is the major metric to track. How the co. is acheiving that vol. growth nd wat’s the best way to pursue it is an endless debate.
Disclosure :- Invested recently. Above is my understanding of the biz nd not a reco in any sense. I hv bee very wrong in my assessments in near nd distant past…
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