Dr. Lal Pathlabs Q3 Results Review - Wait For Volume Recovery Getting Longer: Yes Securities

Yes Securities Report

Dr. Lal Pathlabs Ltd.'s reported in line growth even as volume growth remains tepid. Management expressed hope about volume recovery on back of initiatives like expansion in tier-III and IV towns, addition of labs and leveraging suburban network.

It is pivoting suburban towards direct to consumer brand though this would be executed over several quarters. Dr. Lal Pathlabs is not looking to take price hike in the near term even as single digit volume growth on a repriced base may make reaching double digit growth a challenging task.

Despite addition of large collection infra over last three years, reckon there is no commensurate volume growth; management is cognisant of volume challenges and hopeful of a rebound, we believe a change to our negative stance is warranted only post revival in volumes.

No major change to our FY24/25 estimate and continue with 'Reduce' rating and unchanged target price Rs 2,500.

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