Reduce Vijaya Diagnostic Centre; target of Rs 590: ICICI Securities

ICICI Securities recommended reduce rating on Vijaya Diagnostic Centre with a target price of Rs 590 in its research report dated December 22, 2023.

Broker Research

December 23, 2023 / 20:49 IST

Reduce

26 Aug, 2025 12:21

Volume

Todays L/H

ICICI Securities research report on Vijaya Diagnostic Centre

Vijaya Diagnostic Centre (Vijaya) has acquired 100% stake in Pune-based PH Diagnostic Centre Private Limited (PH) for a cash consideration of INR 1,475mn (including INR 128mn for debt repayment). The business dynamics of PH Diagnostic are identical to Vijaya and can be swiftly integrated. Besides, PH’s ability of high end testing pertaining to allergy and genomic may also add new capabilities to the combined portfolio. The acquisition also addresses concerns on replicating Vijaya’s business model beyond Andhra/Telangana region as the share of these regions may come down to 89% in FY25E vs ~97% currently. We raise our EBITDA for FY24/25E by 2-8% to factor in this acquisition.

Outlook

The stock trades expensive at 21.8x FY25E EV/EBITDA, we retain our REDUCE recommendation. However, we raise target price to INR 590.

For all recommendations report, click here