Buy Vijaya Diagnostic; target of Rs 1150: Emkay Global Financial

Emkay Global Financial is bullish on Vijaya Diagnostic has recommended buy rating on the stock with a target price of Rs 1150 in its research report dated May 13, 2025.

Broker Research

May 13, 2025 / 12:58 IST

Buy

26 Aug, 2025 12:21

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Emkay Global Financial' research report on Vijaya Diagnostic

Vijaya’s Q4FY25 results were a slight miss on our estimates (2%/3% on sales/EBITDA) due to industry-level headwinds (extended festivities in South India), capacity constraints in Pune centers, and gross margin contraction. However, the outlook for the next 2-3 years looks promising on the back of timely commissioning of new hubs in non-core geographies and management guidance of +15% sales CAGR over FY25-28. We expect EBITDA margin to be flat over the next two years, as operating leverage offsets initial losses owing to multiple hub additions in FY26. Factoring in the Q4 miss, we cut our FY27 sales/EBITDA estimates by 2%/4%, respectively.

Outlook

We maintain BUY with unchanged Mar-26E TP of Rs1,150 (DCF-based), implying FY27E PER of 53x. Sustained growth momentum (18% sales CAGR), robust balance sheet, and cash-flow generation provide comfort on valuations.

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