VIJAYA

Strengthens Regional Footprint, Merger to Unlock Synergies

reported solid Q3FY26 results, with revenue up 21% YoY to ₹205 crore despite a strong base and off-peak season. Footfall and test volumes rose double digits, while revenue per footfall improved. EBITDA grew 28% YoY, with margins expanding to 41.9%, supported by operating leverage from new hubs and mature centres. Wellness services continue to gain traction, reinforcing a structural shift toward preventive healthcare. Q3FY26 Performance Highlights - Revenue: ₹205 crore, +21% YoY. - Footfall: +11% YoY; test volumes: +15% YoY. - Revenue per footfall: +9% YoY. - EBITDA: +28% YoY, margin expanded 220 bps to 41.9%. - Drivers: Ramp-up of new hubs, strong mature centres, wellness services (14.7% of revenue). Expansion & Integration - Four new hubs commissioned in Q3 (Andhra, Telangana, West Bengal). - West Bengal hubs achieved breakeven within three quarters, ahead of guidance. - Pune: Integration of PH Diagnostics completed; centres rebranded under VDC. - Additional hubs and spokes operationalised post-acquisition. - Proposed merger with Medinova Diagnostic Services (effective April 1, 2026) to unlock synergies, cost efficiencies, and strengthen competitive positioning. Strategic Priorities - Stabilise newly launched hubs and accelerate spoke centre rollout. - Invest in advanced diagnostic technologies to enhance customer experience. - Strengthen brand equity in newer geographies. - Focus on Tier-II expansion and preventive healthcare services. Outlook & Guidance - Management guidance: ≥15% revenue growth in FY26, EBITDA margin ~40%. - Growth drivers: Volume expansion, modest price hikes, wellness traction. - Margin resilience expected despite expansion costs. Valuation & Recommendation - Valuation: 26x FY27E EV/EBITDA, marginally below historical average. - Strong execution, disciplined capital allocation, and merger-led synergies support earnings compounding. - Rating: Overweight, backed by high-quality growth profile and consistent operating performance.