Moneycontrol
Nov 10, 2017 11:30 AM IST | Source: CNBC-TV18

Expect 26-27% margins for full year; Q3, Q4 to be good on low base: Dr Lal PathLabs

The company continues to remain highly competitive right across all segments of market ranging from preventive to illness and even to predictive going into the future, said Dilip Bidani, CFO, Dr. Lal PathLabs.

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Dr Lal PathLabs reported a 3.96 percent dip in its consolidated net profit to Rs 50.9 crore for the September quarter of the current fiscal. The consolidated revenues for the quarter were up 6.1 percent to Rs 278 crore versus Rs 262 crore for the corresponding quarter last fiscal. The margins came in at 28 percent versus 30.5 percent YoY. The total expenses were up 9.9 percent to Rs 200 crore.

The board of the company has recommended an interim dividend of Rs 1.50 per equity share of Rs 10 each.

Dilip Bidani, CFO, Dr. Lal PathLabs said they are very happy with the volume growth of 6.7 percent in Q2, which was above the revenue growth of 6.1 percent.

He said, looking at historical averages and statistics, the first half revenues are around 50-51 percent. The third and fourth quarter are expected to be good on a lower base, he said.

Talking about margins, he said on an overall basis with the kind of cost controls, productive measures, price rationalization in certain geographies, the margins are expected to be around 26-27 percent for the full year.

Kolkata lab which will be started in third quarter will first add to costs but longer-term it will add to our margins.

When asked about competitive trends, he said the market place is competitive with new entrants coming into various markets – tier II, tier III cities and trying to build up brand franchise. The competition is also from players that focus on preventive health checkups, said Bidani.

However, the company continues to remain highly competitive right across all segments of market ranging from preventive to illness and even to predictive going into the future. We also have competency in spaces like  higher-end genetics molecular diagnostic tests.
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