Dr Lal PathLabs’ shares sank over four percent intraday on Monday, April 28. While the medical diagnostic centre reported a steady March quarter, brokerages had a mixed outlook for the current quarter.
Dr Lal PathLabs reported consolidated quarterly numbers with net sales rising 10.5 percent to Rs 603 crore in March 2025 from Rs 545 crore in March 2024. The company's quarterly net profit also jumped 83.2 percent to Rs 154.80 crore from Rs 84.50 crore a year ago.
Management continues to prioritize volume expansion as a key growth driver and may avoid implementing price hikes in the near term. Dr Lal PathLabs has given guidance of 11-12 percent growth in FY26 driven by volume and stable revenue per patient.
On the margin front, the company expects a drop of 100 bps (based on its guidance of 27 percent margin) due to investment in geography expansion, talent, digital initiatives, and marketing.
At 1.05 pm, shares of Dr Lal Path Labs were trading at Rs 2,844.45 per share, lower by XX percent.
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Revenue was posted in-line with expectations, largely volume driven also aided by higher Swasthfit contribution, while the net profit beat consensus estimates, noted brokerages.
Going ahead, according to ICICI Securities, the diagnostics player could face margin stress. In FY2025, the company opened 18 labs in tier-3/4 cities, with 15–20 scheduled for FY2026.
“Network expansion, investment in new technologies and lack of price hikes on majority of the portfolio may exert pressure on margins in FY26,” added the brokerage, maintaining its price target of Rs 2,900 apiece, with a ‘hold’ rating.
Nuvama Institutional Equities noted that Dr Lal Path Labs is putting efforts to drive up volume growth, evident from its accelerated network expansion plan. “The relatively stable competitive landscape with sector tailwinds such as growth in geriatric population and consolidation in industry are positives.” Nuvama retained ‘buy’, with an unchanged target price of Rs 3,770.
“While the valuation remains fair, the lack of meaningful upside in earnings growth led us to downgrade our rating to ‘hold’ (from ‘add’) with a lower target price of Rs 3,100 (Rs 3,600 earlier),” said InCred Equities.
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