ICICI Securities research report on Thyrocare Technologies
Thyrocare Technologies’ (Thyrocare) outperformance in Q4FY25 was driven by surge in volumes (up 15%) and realisation improvement, partially offset by higher ESOP cost. Pathology segment reported a strong ~22% YoY organic growth (reported 24.4% growth) driven by 22%/24% growth in franchisee and partnership segments. Addition of new smaller franchisee helped the company boost volumes and improve realisation. Barring sales to API holdings (11% of total revenue), its partnership segment reported a robust growth of 40% YoY. Gross margin expanded 380bos YoY led by better negotiation and favourable mix while EBITDA margin rose 890bps to 30.8%. Management has guided for mid teen revenue growth in FY26 and EBITDA margin at ~31%.
Outlook
We raise FY26/27E EBITDA by ~7%/10% and EPS by ~9%/11% led by better outlook on margins. Upgrade to BUY with higher TP of INR 1,000.
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