Vijaya Diagnostic Centre Limited (VIJAYA) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Q4 FY '26 Earnings Conference Call for Vijaya Diagnostics hosted by JM Financial. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Amey Chalke from JM Financial. Thank you, and over to you, sir. Thank you.

Good afternoon, everyone. I'm Amey Chalke. And on behalf of JM Financial, I would like to extend a warm welcome to all of you on the fourth quarter FY '26 earnings call of Vijaya Diagnostic Centre Limited. At the outset, I would like to thank the management of Vijaya Diagnostics for giving us the opportunity to host the call. We look forward to having an engaging and insightful discussion on the Company's quarterly performance and the outlook. From the company, we have with us today Ms. Suprita Reddy, Managing Director and Chief Executive Officer; Mr. Ankit Shah, Chief Financial Officer; Mr. Sivaramaraju, Chief Operating Officer; and Mr. Dhiren Gala, Assistant General Manager, Strategy and Investor Relations. With that, I will now hand over the call to the management for their opening remarks. Over to you, ma'am.

Thank you Amey, for hosting the call. Good afternoon, and thank you all for joining us on the call today. As we complete our fifth financial year since listing, I would like to first thank all our shareholders and the research houses for their continued trust, confidence, and support throughout our journey. Over these 5 years, we have accomplished several important milestones. We have doubled our centers from 81 to 162, expanded our footprint from 2 states to 6 states, and successfully acquired PH Diagnostics in Pune, which majorly aligned with our ethos. Like we have consistently stated over the years, the core principles and DNA of the company remain unchanged. Our business continues to be guided by the key pillars: a strong focus on Quality and customer experience, continuous investment into technology while ensuring affordability and most importantly, our investment into talent. Our workforce has grown from nearly 2,000 employees to over 3,500 employees over these 5 years, welcoming close to 1,500 new members into the Vijaya Family. Going forward, we will continue to invest in talent and technology while maintaining a sharp focus on quality, as we always believe that sustainable financial performance is ultimately a byproduct of a discipline and a purpose-driven approach. Having said that, over the last 5 years since listing, we have delivered a revenue CAGR of 17%, exceeding our guidance of 15%. Most importantly, this growth has been achieved without any dilution in the EBITDA margin. FY '26 has been a landmark year for Vijaya, with revenues crossing the INR 800 crore milestone, reflecting a strong operational execution across the business. We have also delivered a robust year-on-year revenue growth of 26.5% in Q4 FY '26, supported by a healthy volume growth of around 18.5%. This performance was attributable to both Pathology and Radiology segments, aided by a very favorable seasonal environment, strong momentum in the Wellness segment, continued network expansion across geographies and accelerating traction of the Vijaya brand in new markets supported by our differentiated service proposition. Turning to PH. We delivered a year-on-year growth of 16%, primarily driven by network expansion and favorable seasonality during the quarter. Our Ambegaon Hub center has achieved breakeven in 1 year, in line with our guidance. Further, the 2 hubs launched in Q3 FY '26 in our core markets, Khammam and Nandyal achieved breakeven within just 2 quarters, outperforming our guided time line of 3 quarters of for hubs in our core markets. Coming to our expansion plan for FY '27, we would be commissioning 4 to 5 hubs and 10 to 12 spokes across the network. We're also coming up with a state-of-the-art, totally automated lab in Punjakutta, Hyderabad with an automated track system, which is expected to enhance turnaround times and operational productivity. Additionally, we plan to introduce advanced Genomic Testing as part of our Specialized Diagnostic offering. With this, I would like to once again thank our teams across the network for their commitment to make this a very successful year for Vijaya. We remain confident in our ability to build on this momentum and continue to create a long-term value for all of our stakeholders. I will now hand over to Ankit to walk you through the Operational and the Financial Highlights.

Good afternoon, everyone, and a very warm welcome to everyone joining us on the call today. I'll quickly take you through the financial performance and the quick key developments for the current quarter Q4 and the financial year ended March 31, 2026. The consolidated revenue for the current quarter stood at INR 219 crores, reflecting a strong revenue growth rate of 26.6% Y-o-Y. And this strong revenue growth, just like the previous quarter was driven by test volume growth of 18.5% Y-o-Y. Balance growth of 8.1% was largely on account of change in the test mix. Coming to the geography-wise revenue contribution for the quarter, Hyderabad contributed 67%, rest of AP, Telangana contributed 20%; Pune, 6%; West Bengal, 4%, and rest of the geographies contributed 3%. Like the previous quarter, the revenue growth has been driven by both Radiology and Pathology segments, reflecting the robustness of our B2C-focused integrated business model. The B2C revenue stood healthy at 92%. Our Radiology business stood at 37%. The revenue per test and Revenue per Footfall stood at INR 488 and INR 1808, respectively, during the current quarter. EBITDA for the current quarter stood at INR 95.5 crores as compared to INR 68.9 crores in the corresponding quarter in the previous year, reflecting a Y-o-Y growth rate of 38.7%. The EBITDA Margin stood healthy at 43.5% in the current quarter with an improvement of 379 basis points Y-o-Y. The Profit After Tax for the current year -- for the current quarter stood at INR 47.9 crores, reflecting a strong growth of 37.5% and a PAT Margin also stood healthy at 21.8%. I will now summarize our performance for the financial year ended March 2026. The consolidated revenue for the financial year ended FY '26 stood at INR 814 crores as against INR 681 crores in the previous financial year FY '25, reflecting a Y-o-Y growth of 19.5%. EBITDA stood at INR 337 crores as against INR 273 crores in the previous financial year, registering a Y-o-Y growth of 23.3%. EBITDA margin stood healthy at 41.4%, and the Profit After Tax was INR 173 crores with a margin of 21.2%. Coming to the update on capital investment in the current period. The overall CapEx outlay has been INR 169 crores, inclusive of replacement CapEx. For FY '27, the capital outlay for the new centers, including the lab, the new automated lab is estimated to be INR 140 crores to INR 150 crores. That's all from my side. I would now like to request the moderator to open the lines for the Q&A session.

[Operator Instructions] Our first question comes from the line of Surya Patra with PhillipCapital.

Congratulations for the great rate of numbers. Since it is the fourth quarter and the RCA very consistent for once [indiscernible] statement, consistently around 30% growth that has been maintained, so I just wanted to understand what would be mix between Pathology and Radiology when we talked about [indiscernible] and what should be contributing incrementally to this kind of growth?

So Surya, all our packages have a mix of both Radiology and Pathology. So while we don't have the very exact number because it's a bundled package, right, from Corporate Wellness to Retail Wellness, it's a mix of both Radiology And pathology. But if you see more or less, they'll be mostly at 50-50% proposition. And it is also based on -- if you see our retail packages, which are there on the website, right? From lifestyle to full-body health checkup, you have a mix of both Path and Rad even what we are seeing the trends that we are seeing from the corporates, right, whenever they are empaneling for their Employee Health Checks, they are asking us a mix of both Pathology and Radiology tests. So that's the trend that we are seeing across the packages.

Or is it fair to believe that whatever the mix that we are seeing for the overall business, that is the mix also for the wellness business that one should think?

So it depends. When it comes to corporate Wellness, it purely depends on the client requirement. But in terms of retail, yes, it's more or less maybe in the similar range.

And in terms of the growth, what we are seeing that even Hyderabad, which has been considered to be a mature segment in that we are seeing around 20% growth, one of the strongest growth that we have reported this quarter. Anything specific that is contributing and how sustainable is the growth momentum in Hyderabad?

So like we discussed in the past, right? Whenever we have a good season when we have that revenue in the market. Hyderabad, like we discussed in the previous calls also, we feel the market is mature, but then we see the market growing at a similar pace or a little bit in a better pace, both across hospitals and diagnostics. And especially like ma'am mentioned in her opening remarks, I think the 3, 4 key pillars, is making a strong -- and we being the largest player and being in the industry for more than 40 years in the market. I think we are inching -- as and when there is a favorable season, we are inching the market share. And we are growing better than our peers. So even in terms of network expansion and also if you see the service addition, et cetera, in the diagnostic market, we are growing better than our peers on this space. It is because of the 3, 4 things. One, we are available across the city. We have the wide range of services, both in Pathology and Radiology. We have very high-end technology, and we have very good talent in terms of doctors and technical staff. While maintaining all this, we are not charging anything extra. So more or less, we match the market rates, maybe 2%, 3% here and there. I think that over the years, if you see it's not today's scenario, maybe like a few percentage here and there. Over the years, in Hyderabad, we were growing in double digit. And even in the near term, in the current Financial Year also, we are planning to add a few more Spokes in Hyderabad. There are many new markets, new pockets that have opened up in Hyderabad. So we foresee that even in the near future of 2 to 3 years of term, we will still grow in double-digit in Hyderabad.

And in terms of traffic for investment for them. We have seen obviously in the recent years because of our geographical diversification, some CapEx intensity that we have seen. But we are now talking about similar kind of CapEx momentum even in FY '27. So practically, what is the thought process here because obviously, the Cash Flow comes in Operation if you see, has been obviously becoming stronger and stronger. So is it fair to believe that the CapEx momentum also simultaneously will become stronger and stronger with more and more a newer area penetration.

You're right, Surya. So the number that we just quoted is basically the centers which are like where we have taken on lease. But...

Major executed signed registered lease is something that we would probably announce out on a call. And the capital outlook of what Ankit has given is keeping in mind the entire 4 hubs of what has been signed and the Automated Lab and the 10, 12 Spokes that are coming. Like we've mentioned earlier on, last year, you did not see any Spokes coming out in Hyderabad or the core markets. And this year, we will be seeing a few spokes around 4 to 5 spokes coming out in Hyderabad in the newer geographies and the new pockets that are coming in the city. So this is a CapEx guidance for the executed leases, which is the 4 to 5 Hubs and the 10 to 12 Spokes. Like I've always mentioned, when there's opportunity, there is not looking back -- now we have 2 or 3 more geographies. So whether it's going to be Bangalore or Pune or Calcutta, anything that comes across, we will be signing and probably executing it on the similar lines. We'll be able to give you guidance on that once that's executed.

Yes, yes. So this guidance for next 1, 2 years because we have many newer geographies, this guidance, we will revisit every single quarter, and we'll give you more updates as and when we finalize more centers.

Okay. Just last one point from my side. See, in your opening remarks that you mentioned over the last 5 years, the growth in terms of the center addition that we have seen similar is the business growth that is what we have seen, so that is, it is a volume-led growth only that we have seen practically in a way, so is there any scope for bring him addition may help that in the near future that you think or and simultaneously as you are mentioned also that Genomics that is the new area of accessibility for you, what is the incremental business that you are thinking out of this or what is the target market that you are identifying for the Genomics? Because right now is smaller one and the competition it gets depend?

Genomics is a long-term play. I don't think we'll see any significant revenue coming in the next years.

There are a few departments in lab, Surya, irrespective of volume, say, Histopathology, high-end IHC testing, Genomics. These are all specialized testing and especially being a 92% B2C-driven player, we kind of look at the load building up and then decide to add it. So Histopathology has now been there for more than 35 years and one of a very large department in the lab. So we've started Genomics. We will slowly grow it through the same medium of walk-ins, B2C and then add panels as what is required as per the market needs. So what we see in Kolkata might be very different from what Pune would want. But it will be one central lab in Hyderabad, trying to cater to all of the 6 geographies that we are operating in. So it's just the beginning. So it's something that we would like to build out and then make it profitable in the years to come. I can't give a number on that right away.

And the focus for the next 2 years will be on center addition and volume-driven growth. While we may have that 1%, 1.5% of realization growth, right? But the major focus for the next 2 to 3 years is capacity addition and then volume-driven revenue growth.

Our next question comes from the line of Rajat Bala [indiscernible].

So my first question would be like in Q4, the EBITDA margin came in 43.5%, which is 380 bps Y-o-Y expansion. But when you strip out the operating leverage on the fixed cost base, the Other Expense line grew 21% in Y-o-Y in Q4. So what specific cost levers drive this margin outperformance? Can you throw some color on that?

So it's basically the Operating Leverage in the existing network. So if you see our business, except few costs like consumables, doctors, et cetera, it's more a fixed cost business. So whenever you see a jump in the revenue growth, obviously, that will flow down to EBITDA. And also the other point is all the new hubs that started, majority of the new hubs have broken even faster than the expectation. So it is a mix of both the Operating Leverage and the break-even of new centers that have led to the 43.5% margin. But at the same time, if you see the company is now also focusing of adding more centers and also getting into Genomics and also investing on to Technology and Talent. So in fact, in many of the newer geographies, we are developing the second in line because we feel the Talent is important for us to scale the centers there. So this incremental cost will be for this financial year. But in terms of the guidance, we are with growth while opening new centers, we'll still be delivering 30% plus EBITDA margin. That is one of the reasons why the EBITDA margins were closer to 43.5% this time around was due to Hyderabad geography growing at 20%. So there was a huge operating leverage came due to that. And overall, if you look at the OpEx burn also for the entire year for all the new centers which commenced, it is roughly about 0.8% versus what we had envisioned before the start of the year of roughly about 2%, 2.5%. So these 2 reasons helped in improvement in the EBITDA margin. Having said that, I think going forward, because of -- you can say, we would be slightly conservative in giving our margin guidance of 40%. But we are pretty confident of delivering more than that in the future.

Okay. Great, sir. And sir, the last question on the Revenue per Test, which has been a jump by 4.3%. So even though your Pathology, Radiology mix is quite similar in FY '25. So is it because of Wellness share increase or what's the reason?

No, that is largely because of the New Hubs ramping up. So all the New Hubs in Bangalore, West Bengal, now they are ramping up quickly. So that is just because of the change in the Test Mix because in the first year, it is still driven largely by Radiology. So that's why you're seeing that higher number.

And sir, what's the Volume Growth in terms of Core Geography and non-core geography?

Volume growth in core versus non-core?

Yes, core versus non-core, yes.

Yes. So when it comes to Hyderabad for Q4 Y-on-Y, the volume growth is roughly about 18.5%.

Our next question comes from the line of Anshul Agrawal from Emkay.

Just hopping on the margins guidance. I understand we want to be conservative. But if I just look at the mix of assets that we are commissioning in FY '27, which are more Spokes than Hubs, would it be fair to assume margin accretion in FY '27 would be sharper than the accretion we have witnessed in FY '26 itself?

So Anshul, if you see the full year, I understand in Q4, we have delivered 43.5%, but if you see for the entire full year, it was around 41.5%. So like if we are opening, let's say, 12 Spokes and 4 Hubs, yes, more or less, we may end up in the similar range. But let's say, if we -- like we also said there are more Hubs in pipeline. If we can close a higher number of Hubs and we open in FY '27, then maybe the drag will be slightly higher than what we are talking now. So keeping all this in mind, what we feel is also taking both the investments on to Technology and Talent into consideration, we feel that we'll be able to comfortably deliver more than 40%. And like Dhiren said, while the guidance would be 40%, we'll try to deliver a better number than that.

Sure. Next question I had was we already have a cash balance of almost INR 280-odd INR 300-odd crores. And I think by the looks of it, assuming the CapEx that you have just outlined, we should be able to add another INR 150 crores to INR 200 crores odd number in the next year as well. Any plans on deploying this balance for any inorganic expansion? And how does management think about this -- deploying this cash on books?

Anshul, like we've mentioned earlier, anything that comes to us in terms of an inorganic or a Merger and Acquisition, JV, whatever it might be, if it is in the same value system and it is B2C-driven, even if it's pure Pathology or Radiology and Ethos matches, we're more than happy to look at that asset. And then comes the valuation reasonability there also. So if something comes up, it's -- there's almost close to about 8 to 15 assets that come to us on a yearly basis. But we are very, very conscious about what we bring on to the table to the Board and to our shareholders because it needs to add value. And that probably that look is going to be out even for the future. And also like Siva mentioned, these are only executed leases for this year of, say, that 3 to 4 Hubs. And if an opportunity comes up, like I mentioned, 2 to 6 states. So if, say, we get an opportunity to add another 4 or 5, we would definitely go ahead doing that. So you could also see additional deployment and CapEx happening accordingly. And with Hubs also comes Spokes. So that's the reason why we are only probably committing on the number of leases that are executed today. And as we go quarter-on-quarter, we will be giving you a quarterly update on what's going to be happening.

So very clear, ma'am. But there are no plans of adding another Cluster for the next 2-odd years? I think you mentioned that.

If you're looking at the numbers and everybody is very happy, the Operating Leverage playing out today is because of the dense network. So we're saying you have entire Pune and then Calcutta and now already Bangalore is a new baby and with a few more hubs coming there. So the denser we grow into Calcutta in West Bengal and into Pune, this is probably going to just get better.

We have to add that this should be through inorganic, but...

It should be large enough for us to say we are ready to take on one more Cluster.

Got it. Clear, ma'am. Just a follow-up question on the answer that you gave. Our current CapEx guidance, if I just sum up the bits and pieces of our Network Addition or the Automated Lab. Our current CapEx guidance of INR 140 crores, INR 150 crores, does it not assume any New Hubs that you have planned, which have not yet signed the lease on? Because if you could just slightly break up the INR 150 crore CapEx number in terms of Network Addition, in terms of IT Spend, or Maintenance CapEx, that would be very useful to help us understand this better.

So Anshul, for the new centers, which have been outlined in the Investor Presentation, which are roughly about 4 to 5 Hubs and 10 to 12 Spokes, the CapEx would be between INR 120 crore to INR 130 crore. And then the additional CapEx would be on the automated lab in Punjagutta. These are only -- this CapEx is for the leases which have been executed. Having said that, as Shiva and ma'am mentioned, there are a lot of projects in the pipeline. So whenever we get the opportunity, we will definitely revise the CapEx guidance, but that revision will happen on a quarter basis.

Just to add, Anshul, so what we have considered in this INR 150 crores is about close to INR 10 crores to INR 12 crores of replacement CapEx. It is not just a replacement CapEx, CapEx is in the existing centers where we'll add some new modality.

Got it. And are we planning any flagship Hubs in the non-core Clusters because INR 120-odd crore for 4 hub-and-spoke seems heavy.

Yes. So we had announced in Q3 of FY '26 that we'll be coming up with flagship center in Bannerghatta, Bangalore, Jayanagar, which will have the high-end PET CT, high-end MRI and cardiac CT...

This is a center, Anshul, where the center has equipment which are probably not there in our Core markets Of Hyderabad itself. So you will be looking at digital cardiac PET/CT coming in there. And it's a one of its kind very wide bore [indiscernible] Omega MRI, I think there are only a few in India. So this is what Bannerghatta is going to offer and probably it should be ready to go in the next couple of months. So that's something that's ongoing, and this is -- and going forward, we'll probably in the coming year, look at bringing in a center like that even in the Core Market of Hyderabad. So finding that right place location in Hyderabad, we will do a center like that provided we find the right location.

Okay. Very clear. Just a couple of more questions, if I may. On Wellness, what would be the Average Realizations of -- in our Wellness Portfolio for the company, average realizations for us?

It's in the range of INR 1,800 to INR 2,000 Anshul. So for Q4. So otherwise, generally, at a full year level, it was more or less closer to INR 2,000. It is because of Corporate Wellness because Corporate Wellness, every client has a different requirement. But if you see Retail Wellness, it will be slightly higher than INR 2,500 is the Average Realization.

Okay. The reason why I ask this question is incremental Wellness -- incremental contribution from Wellness Portfolio would not lead to Realization per Patient improving. Would that be fair to say?

It will lead to Realization per Patient improving, but not the Realization of Test because if you see at the company level, we are at -- this quarter, we were at INR 1,800 Realization per Patient. If we add more Wellness Packaging, Realization per Patient will go up, but Realization per Test will come down.

Got it. Very clear. Just one last question. I think ma'am mentioned that PH or the Pune Cluster has grown by 16% Y-on-Y. That is for the current quarter or for the full year?

The current quarter. So if you see, Anshul, Q1, Q2, there was a slight degrowth. And Q3, we have seen improvement. So I think Q3, we grew by, I think, 8%, right? And this quarter about 16%. So we are seeing uptick in revenue both month-on-month and quarter-on -- year-on-year.

Yes. And this would be largely on the back of the new center additions we have done, right? Or have we done any capacity bottlenecking in the PH centers that we had?

So yes, we have a little bit of capacity constraint. But then we have seen growth even in the existing centers, but it is in the low-single-digit, but it's a mix of both the old [indiscernible].

Our next question comes from the line of Akshaya Shinde with Centrum Broking Limited.

Congratulations on good set of numbers. My question pertains to the Kolkata region. The 2 hubs launched in FY '24 were contributing around 3% of revenue. Could you share how these hubs have progressed so far in terms of volume growth, the B2C mix and the breakeven trajectory. Also with the 5 New Hubs added in FY '26, do you expect similar ramp-up trajectory for this center? Or could the scale up be relatively faster supported by the higher network density and improving brand presence in the region?

So as of now, we have 7 Hub Centers in Kolkata, so out of which 3 centers were just opened a couple of quarters back. If you see the old centers, Medinova and the VIP Road, you've seen the growth, right? So they've grown at very -- majorly VIP Road because Medinova again was the old center and it is running at its full capacity. If you see VIP Road, you've seen double-digit growth year-on-year. And the rest of the 5 centers were added during the last financial year, out of which 2 centers, which were added in Q1 of FY '26, they did breakeven in less than 9 months. The rest of the centers like Phoolbagan, Diamond Harbor, they just opened a couple of quarters back. But we expect the similar kind of ramp-up to happen at these centers, and we are confident of achieving the breakeven within 1 year of our guided time line. So the next financial. So I don't think we should compare with the current base to the next year's growth because of the center addition that happened. But you will see a very healthy growth of revenue in West Bengal in the next -- in the current financial year.

Also, following the Pune expansion, are there any inorganic opportunities shortlisted for the further expansion in the Western region like for the mid- to long term?

Not in Pune as of now. So we want to more go organically because since we have acquired a brand, now I think it is we feel that it would be better if we expand this brand rather than acquiring one more asset in the same geography.

Our next question comes from the line of Kirti Agrawal from Aditya Birla Sun Life Mutual Fund. margin accretion in FY '27 would be sharper than the accretion we have witnessed in FY '26 itself?

So Anshul, if you see the full year, I understand in Q4, we have delivered 43.5%, but if you see for the entire full year, it was around 41.5%, right? So like if we are opening, let's say, 12 spokes and 4 hubs, yes, more or less, we may end up in the similar range. But let's say, if we -- like we also said there are more hubs in pipeline. If we can close a higher number of hubs and we open in FY '27, then maybe the drag will be slightly higher than what we are talking now. So keeping all this in mind, what we feel is also taking both the investments on to technology and talent into consideration, we feel that we'll be able to comfortably deliver more than 40%. And like Dhiren said, while the guidance would be 40%, we'll try to deliver a better number than that.

Sure. Next question I had was we already have a cash balance of almost INR 280-odd INR 300-odd crores. And I think by the looks of it, assuming sort of the CapEx that you have just outlined, we should be able to add another INR 150 crores to INR 200 crores odd number in the next year as well. Any plans on sort of deploying this balance for any inorganic expansion? And how does management think about this -- deploying this cash on books?

Anshul, like we've mentioned earlier, anything that comes to us in terms of an inorganic or a merger acquisition, JV, whatever it might be, if it is in the same value system and it is B2C driven, even if it's pure pathology or radiology and Ethos matches, we're more than happy to look at that asset. And then comes the valuation reasonability there also. So if something comes up, it's -- there's almost close to about 8 to 15 assets that come to us on a yearly basis. But we are very, very conscious about what we bring on to the table to the Board and to our shareholders because it needs to add value. And that probably that look is going to be out even for the future. And also like Siva mentioned, these are only executed leases for this year of, say, that 3 to 4 hubs. And if an opportunity comes up, like I mentioned, 2 to 6 states. So if, say, we get an opportunity to add another 4 or 5, we would definitely go ahead doing that. So you could also see additional deployment and CapEx happening accordingly. And with hubs also comes spokes. So that's the reason why we are only probably committing on the number of leases that are executed today. And as we go quarter-on-quarter, we will be giving you a quarterly update on what's going to be happening.

So very clear, ma'am. But there are no plans of adding another cluster for the next 2-odd years? I think you mentioned that.

If you're looking at the numbers and everybody is very happy, the operating leverage playing out today is because of the dense network. So we're saying you have entire Pune and then Calcutta and now already Bangalore is a new baby and with a few more hubs coming there. So the denser we grow into Calcutta in West Bengal and into Pune, this is probably going to just get better.

If we have to add then it should be through inorganic, route but...

It should be large enough for us to say we are ready to take on one more cluster.

Got it. Clear, ma'am. Just a sort of follow-up question on the answer that you gave. Our current CapEx guidance, if I just sum up the bits and pieces of our network addition or the automated lab. Our current CapEx guidance of INR 140 crores, INR 150 crores, does it not assume any new hubs that you have planned, which have not yet signed the lease on? Because if you could just slightly break up the INR 150 crore CapEx number in terms of network addition, in terms of IT spend or maintenance CapEx, that would be very useful to help us understand this better.

So Anshul, for the new centers, which have been outlined in the investor presentation, which are roughly about 4 to 5 hubs and 10 to 12 spokes, the CapEx would be between INR 120 crores to INR 130 crores. And then the additional CapEx would be on the automated lab in Punjagutta. These are only -- this CapEx is for the leases which have been executed. Having said that, as Shiva and ma'am mentioned, there are a lot of projects in the pipeline. So whenever we get the opportunity, we will definitely revise the CapEx guidance, but that revision will happen on a quarter basis.

Just to add, Anshul, so what we have considered in this INR 150 crores is about close to INR 10 crores to INR 12 crores of replacement CapEx. It is not just a replacement CapEx, CapEx is in the existing centers where we'll add some new modality.

Got it. And are we planning any flagship hubs in the non-core clusters because INR 120-odd crores for 4 hubs and spoke seems heavy.

Yes. So we had announced in Q3 of FY '26, that we'll be coming up with flagship center in Banneghatta, Bangalore, JP Nagar, which will have the high-end PET CT, high-end MRI and cardiac CT.

This is a center, Anshul, where the center has equipment which are probably not there in our core markets of Hyderabad itself. So you will be looking at digital cardiac PET CT coming in there. And it's a one of its kind very wide bore Omega MR. I think there are only a few in India. So this is what Bannerghatta is going to offer and probably it should be ready to go in the next couple of months. So that's something that's ongoing, and this is -- and going forward, we'll probably in the coming year, look at bringing in a center like that even in the core market of Hyderabad. So finding that right place location in Hyderabad, we will do a center like that provided we find the right location.

Okay. Very clear. Just a couple of more questions, if I may. On wellness, what would be the average realizations of -- in our wellness portfolio for the company, average realizations for us?

It's in the range of INR 1,800 to INR 2,000 Anshul. So for Q4. So otherwise, generally, at a full year level, it was more or less closer to INR 2,000. It is because of corporate wellness because corporate wellness, every client has a different requirement. But if you see retail wellness, it will be slightly higher than INR 2,500 is the average realization.

Okay. The reason why I ask this question is incremental wellness sort of incremental contribution from wellness portfolio would not lead to realization per patient improving. Would that be fair to say?

It will lead to realization per patient improving, but not the realization of test because if you see at the company level, we are at -- this quarter, we were at INR 1,800 realization per patient. If we add more wellness packaging, realization per patient will go up, but realization per test will come down.

Got it. Very clear. Just one last question. I think ma'am mentioned that PH or the Pune cluster has grown by 16% Y-on-Y. That is for the current quarter or for the full year?

The current quarter. So if you see, Anshul, Q1, Q2, there was a slight degrowth. And Q3, we have seen improvement. So I think Q3, we grew by, I think, 8%, right? And this quarter about 16%. So we are seeing uptick in revenue both month-on-month and quarter-on -- year-on-year.

Yes. And this would be largely on the back of the new center additions we have done, right? Or have we done any capacity bottlenecking in the PH centers that we had?

So yes, we have a little bit of capacity constraint. But then we have seen growth even in the existing centers, but it is in the low single digit, but it's a mix of both the old [indiscernible].

Our next question comes from the line of Akshaya Shinde with Centrum Broking Limited.

Congratulations on good set of numbers. My question pertains to the Kolkata region. The 2 hubs launched in FY '24 were contributing around 3% of revenue. Could you share how these hubs have progressed so far in terms of volume growth, the B2C mix and the breakeven trajectory? Also with the new hubs added in FY '26, do you expect similar ramp-up trajectory for this center? Or could the scale up be relatively faster supported by the higher network density and improving brand presence in the region?

So as of now, we have 7 hub centers in Kolkata, so out of which 3 centers were just opened a couple of quarters back. If you see the old centers, Medinova and the VIP Road, you've seen the growth, right? So they've grown at very -- majorly VIP Road because Medinova again was the old center and it is running at its full capacity, right? If you see VIP Road, you've seen double-digit growth year-on-year. And the rest of the 5 centers were added during the last financial year, out of which 2 centers, which were added in Q1 of FY '26, they did breakeven in less than 9 months. The rest of the centers like Phoolbagan, Diamond Harbor, they just opened a couple of quarters back. But we expect the similar kind of ramp-up to happen at these centers, and we are confident of achieving the breakeven within 1 year of our guided timeline. So I don't think we should compare with the current base to the next year's growth because of the center addition that happened. But you will see a very healthy growth of revenue in West Bengal in the next -- in the current financial year.

Understood. Also, following the Pune expansion, are there any inorganic opportunities shortlisted for the further expansion in the Western region like for the mid- to long term?

Not in Pune as of now. So we want to more -- go organically because since we have acquired a brand, now I think it is -- we feel that it would be better if we expand this brand rather than acquiring one more asset in the same geography.

Our next question comes from the line of Kirti Agarwal from Aditya Birla Sun Life Mutual Fund.

Congratulations on a good set of numbers. I just had a bookkeeping question. What would be your pre-Indias margin for FY '26 and for the quarter, if you can help me with that?

See, by pre-Indias, you're referring to more of Indian GAAP.

Yes, the impact of rentals?

Yes. So while we don't maintain books as per Indian GAAP, but it should be close to about 7% -- so that should be about 35%.

Yes, it's 35% for the entire year.

Our next question is from the line of Rishi Mody with RDM Advisory LLP.

First question I had was on the tech investments that you all are making or you all have made. Just is it upcoming or you all have already made these CRM, ERP and AI in radiology investments?

So Rishi, it's ongoing. So we have invested a little bit in the last financial year, right? Over the years, if you see from FY '23 onwards, consistently every year, we are either revamping the existing systems, and we are also getting more integrations, right, to enhance the customer service and also like if you -- in terms of the building software, LIMS, radiology, all that we have done in the last 2 financial years. When it comes to the CRM or when it comes to the ERP, so we have started the work in the last financial year, but we'll be launching them in the current financial year. Apart from that or in terms of AI, we have onboarded a few solutions in Q4, right, end of Q4, like it can be CTKUB or the dental scans. And we are also in talks with a few of the other firms to see how we can implement for the other modalities like something for lung, liver and the brain. So this will be an ongoing process. And also in terms of data security, right? So year-on-year, we are increasing our spends on that. And in terms of digital marketing, so digital marketing was something which we started 2, 2.5 years back. If you see last one financial year, we've almost spent roughly around INR 6 crores to INR 7 crores on digital marketing, where we see that cost doubling in the current and the next financial year because that's one of the channels where we have seen good revenue coming from. So likewise, Rishi, I think technology is something that is still evolving. So right, for the next 1, 2 financial years, you'll be seeing some investments happening on this front.

Right. So this will be an ongoing process now for you all, and we should not expect ideally any hiccups in the implementation of this, like you mentioned, right, the last time we implemented LIMS, there was some of a hiccup in one odd quarter.

Implementation is not going to be the problem, especially in radiology. These patches that come for any kind of a specific organ, they are basically patches which have to be layered on to our radiology information software. So they need certain licensing just like we would need a CE or an FDA some background to bringing in any kind of AI because you're going to be releasing it for retail customers. So we can't just bring in something without validation. And validation requires certain paperwork. And those are very limited in nature as we speak as of today. So probably something that we can release to customers is not going to be more than 6 or 7. And when these come in, these have to be layered on to the existing software and those are always ongoing. We have two or three that are done. You will always see two or three happening. As and when it gets approved, these get layered on.

All right. That's great to hear. Second, I wanted to understand on the Pune piece, right? So great job on getting the revenue growth back on track and the new team, I think, has done a good job on ground. Just if I could get an understanding, say, the second hub that you opened, right, the new hub, is it ramping up faster? Or is it approaching break-even faster than the first new hub that you all had opened?

No, Rishi, I think both the hubs have taken similar time because I think both the areas are on two different sites of the city. right? So if you see both in Ambegaon and Kalyani Nagar, PH never had any presence. So it was more like a newer -- within the city is like a newer geography, right? And Kalyani Nagar, the full-fledged operation started in Q2 of FY '26. So even that hub like Ambegaon took time. So we have almost completed six to seven months of full-fledged operations by now. I think eight months of full-fledged operations by now. I think we'll be taking the full one year here also for the breakeven to happen.

Okay. All right. And finally, just any favorable seasonality element in our numbers this quarter, like some or some seasonal flu or something in our numbers?

Nothing specific, Rishi, but we have seen growth across both retail and also wellness. So I think all the modalities and all the channels have basically fired. Rishi, overall Lifestyle segment also has shown a good growth during this quarter. So that has also helped in the overall revenue growth.

Our next question is from the line of Sumit Gupta from Antique.

So with respect to Pune. So it grew 16%. So what would be the volume growth for this quarter in PH?

So footfall growth was roughly about 15% during this quarter.

Purely footfall growth, Sumit.

Okay. okay. Okay. And what is the outlook for the PH segment over the next, let's say, three to four years? How should we see this contribution increasing on the two pictures?

So for all of these new geographies, Sumit, so like we said, right, quarter-on-quarter, maybe we'll have to change our guidance a little bit because we have the regional heads for each of these regions. And then parallelly, all these regions are growing. So in terms of finding the new centers, et cetera, the work is happening on the ground at all of these regions. So if you ask us, we are very confident in the next one to two financials, we'll be growing in double digit. But at the same time, let's say, if you find more centers, if you can close on more centers, maybe one geography may be overtaking the other geography. That is something that maybe next two years will be slightly dynamic between these geographies. But otherwise, with the existing network, with these two new hubs and two new stores that we have opened and also the effort that is going on to the corporate segment within Pune, we are confident that we'll be growing in double digit for the next financial year as well at the full year level.

I was asking not in the near term, but from a medium term point of view. So should we see like the kind of traction that you're getting in Pune market. Can we hope to see that continuing?

Sumit, can you please repeat?

So basically the kind of traction that you're witnessing in Pune, so for the medium term, let's say, next three to four years, how should we see Pune geography evolving? So like we will be adding more hubs and spokes. And then the recently opened Ambegaon that has also breakeven. So how should we see that panning up, basically the revenue per center improving?

So Sumit, I think -- especially in Pune, right, I think that was the only one guidance which did not happen according to our guidance, which we gave three years back because we thought Pune in three to five years, we will double our revenue. But then we went very slow. We did not open centers also. We went very slow because after acquiring, we took 1, 1.5 years to settle in ground level things like changing software, aligning the processes, et cetera, because before taking on growth, that is very important. You have to imbibe the culture there before you take on growth. So that's one of the reasons why you've seen the delay in the growth. But having said that, with whatever effort that we have put in the last two years and with the kind of teams now we are deploying there, we are very confident that in next three to five years, we'll be easily doubling up our revenue from where we are now.

Understood. So, with respect to revenue per center at the mature stage, let's say in Hyderabad you are nearly around INR 6 crores per year. So like what kind of -- what is the peak revenue per Center which one can achieve? Or is there any problems or if I am missing something?

No, you will see at maturity the revenue from the new hubs that we have opened, you will see more than INR 12 crores to INR 15 crores kind of a revenue, similar like any other geography there. But in the older hubs, because of the capacity constraints, the hubs being smaller, right, you have one hub which is already even in the older hub, one hub which is doing about INR 15 crores. The rest of the two hubs because of the capacity constraints, they are doing more or less close to INR 10 crores kind of a revenue. But otherwise, in the newer hubs that we open because the hubs will be more or less similar to what we do in Hyderabad. So you'll see the similar kind of revenue profile coming from these centers.

Understood -- and lastly on the Bangalore performance, two hubs which are opened in HSR and Yelahanka, how are they performing? Like what's the overall traction that you're seeing in Bangalore?

So we are very optimistic about the geography with whatever results that we have seen in the last two to three quarters. We opened in Q1 of last financial year. And like we told Yelahanka did breakeven and HSR is almost closer to breakeven. So that's one of the reasons why we have already finalized one flagship facility there. And we also finalized one more location in Rajajinagar, which we have put in on the PPT. And finally, we are looking for more hubs in Bangalore. So we are very optimistic about the Bangalore city.

Okay. Sir, just want to understand on the sector point of view, let's say, so there are so many hospitals which have come with their own labs across different parts of India. So like in your geography, like have you witnessed any like competition competitive increasing, which has led to a bit challenging for you?

So I think, Sumit, this is there across the geographies, not just the hospital-based labs. You have the other labs, which are into purely to diagnostics also, right? Bangalore also has a very strong pathology diagnostic player, right? So -- but like you know, the differentiator is the radiology, right? We have both Pat and radiology, and it's more of an integrated play. And Bangalore as a market like we told you, so it is almost similar to Hyderabad. But you don't have any large integrated diagnostic player. You have multiple small integrated players. That's where we see the opportunity. In terms of the bed density, bed capacity, right, in terms of the health care infrastructure in hospitals, all the cities are more or less closer. And the one more challenge in Bangalore is the traffic, right, which will also give us the opportunity to add more centers. Even if you open two hubs within seven kilometer radius, like if you see our HSR versus the flagship, it is only hardly six, seven kilometer radius. But I don't think a patient from JP Nagar will be traveling to HSR for their diagnostic needs. So that is also another opportunity, right? So considering all these factors, we feel Bangalore city will give us that room to add more hubs and spokes, both hubs and spokes in the next -- at least I think the CapEx deployment will be continuously happening for the next five to seven years.

Okay. So basically, my question was largely from the competition from the hospital-based labs?

Hospitals are basically probably designed to take care of the needs of their inpatients. So if you look at their labs, which are more or less like back-end kitchens, they have to cater to their inpatients. So -- and when they run their OPDs, it's also an odd time where customers will have to get their testing done during fasting. And then they'll have to have some preparation. The pricing is taken into consideration, keeping the entire CapEx of the hospital in mind. And insurance is a major factor there for admissions. So if you look at largely the OPD business, the OPD diagnostics, there are fewer people who basically in India, they need to pay out of their pocket. And cost is one part of it. And that's why we say we are a differentiated kind of a diagnostic facility. We give importance to the customer experience, the large format centers of the 6,000 to 8,000, they're not having to go to two or three places for their pathology, radiology needs and at the same time, not compromising on quality and keeping the prices affordable, which would probably be, say, about 20% to 25% cheaper than the hospital. And being in close proximity to the residential areas, that is why the dense network of Vijaya, that is why the number of spokes to create that density and the spokes feeding into the hubs. That is the basic nature of how we grow and choose where we want to grow.

The next question is from the line of Ayush Agarwal from AARD Capital.

Congratulations on the wonderful performance. I just had two quick questions that we do not have any significant coverage in North India. So that is a strategic decision or that is something that we are not looking at altogether right now?

So to answer you directly, we are not looking at that right now because like we mentioned, we've grown from two to six states, hands are full, trying to build denser networks in two new states that we've acquired. So it's a very strategic decision that we do not want to grow in North. We have one single center in Gurgaon, which is purely a wellness and single center is, in fact, spread across almost an acre of land in 8,000 square feet, and we tend to leave it like that. We want to do more of corporate. And at the point, immediately, we would not want to grow in that region.

So when -- just a follow-up question. When you say immediately, you are talking for the next one to three years or three to five years?

Probably another three to five years is something because we have Karnataka and West Bengal to look at concentrate and grow with Pune already in that process. So definitely three to five years.

Our next question is from the line of Vivek from Emkay Global.

So just a question on the breakdown of centers by region. Could you please help me with the numbers in terms of centers for each region?

Yes. So in Hyderabad, we have roughly about 95 centers. In rest of AP-Telangana, we have 35 centers. In Kolkata, we have seven large hubs. In Bangalore, we have two centers. We have one in Gulbarga. We have one in Gurgaon and the balance in Pune.

Okay. And could you also provide a breakdown of your centers in terms of labs -- in terms of flagship centers, hubs and diagnostics -- sorry, spokes.

Yes. So roughly, we have about 50 hubs and balance 112 spokes. And as highlighted in the press release, we have 30 labs, which also include a couple of mini labs as well.

Our next question is from the line of Akash Shah from Investec Capital Services India Private Limited.

Just one question. So what would be the indicative number for the maintenance CapEx for FY '27?

It will be around INR 10 crores to INR 15 crores.

So typically, the maintenance CapEx is roughly about 2% to 2.5% of our top line. So it will depend on that.

Okay. And sir, just one more question. Are we seeing any traction in the volumes from the offtake of the recent weight loss drug that has gone generic?

So it is slightly difficult to track also because I think somebody who is on to the medicine, not every clinician is writing the package name. So sometimes it's a list of test that we come -- we get as part of prescription. So significantly, we are not seeing any change on the ground.

In spite of being majorly B2C-driven company, we've hardly seen request for a proper GLP package come in. So they tend to either choose to go to a physician or an endocrine and it's the doctor's choice of the test that they request. So we would not probably be able to give you that right number. We've not seen actual request for a GLP package come in yet in the geographies that we operate in.

Okay. Okay. Because -- sorry, just to add one line because a number of players in the diagnostic space have launched their packages. So just wanted to know your view on it.

Our next question is from the line of Dr. Kartick Bane with Bajaj Life.

I would like to ask when was the last time we have taken a price hike. When are we taking it next? And how much would that be in terms of percentage?

We had taken a price hike in Q1 of FY '26. And so it was roughly about, you can say, 1% to 1.5% overall realization. So this year also, we'll be taking roughly about 1% to 1.5% of price hike.

That will be effective either in Q1 or Q2 we will not do that. Maybe in Q1 or Q2, we may take depending on the -- not every year, we do the price hike across tests. Every year, we pick a few tests and then do the price hike.

Our next question is from the line of Abin Benny with JM Financial.

Congratulations on the good numbers. I have two questions. First one was regarding the wellness segment. So our wellness segment growth has been really strong. So just wanted to understand that the demand that we are seeing in this, is there any track that we are keeping on the repeat customers and the first-time users? Like any color on that?

So we have the data, but it's too early to comment because we started tracking these numbers. We migrated to newer systems two years back, and we just started tracking the numbers. While with phone number and also with the unique UHID, we track these numbers, but then I think we should give another two years of time for us to actually see what the recurring customers are because they don't come -- they may come once in a year or once in two years. Not every customer will come once in a year, right? So I think we should give two, three more years of time.

Got it. And in terms of corporates, what is the kind of pipeline or the order book that we are seeing in terms of repeat and retention and also the new ones that being added?

So a few large corporates, yes, we are catering them for the last couple of years. But then at the same time, with a lot of aggregators in play, right? And the corporates -- a few corporates being price sensitive, we keep seeing the churn. But in terms of the large corporates, from the last two, three years, we are continuously getting orders from them.

Got it. Just one last question. So in terms of -- so ma'am, has mentioned between that the pricing related to Vijaya versus hospitals. But in terms of online players, especially in our core geographies and the newer separately, what are the dynamics that we are seeing?

So there is no much impact from online players because for the past five years post COVID, we have seen different multiple online players. The names have changed. But then if you see as such, we do not see any much impact coming from these players. The only change that we see is many of the -- there are many of aggregators which have come into wellness business, especially for corporate wellness. But they don't have their own labs. What they do is they take the bundled package in terms of insurance and also the wellness and then they again outsource these diagnostics to Vijaya or any of the other diagnostic players.

Our next question is from the line of Ayush Agarwal from AARD Capital.

Yes, ma'am, I had one follow-up question. So do we have a plan for the next either one to three years or three to five years of ever exploring the franchisee side of things?

No, Ayush. At the moment, I would not be able to comment on the future, but all of the centers that we operate today are company-owned, company operated. And we do not have any kind of probably an idea on wanting to start franchising right now.

That is definitely, ma'am. That is I know and very much appreciated that this is being done by the company. I just wanted to ask this as a follow-up question that is in the near future or if in the distant future, we wanted to explore the franchisee model like others.

Not at all.

We have no further questions, ladies and gentlemen. I would now like to hand the conference over to the management for closing comments.

I would like to thank everyone for attending this call. Should you need any further clarification or any other information about the company, please feel free to reach out to us. Thank you so much.

Thank you.

Thank you.

Thank you.

Thank you. On behalf of JM Financial, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.