Dr. Lal Pathlabs Limited · NSE:LALPATHLAB
Dr. Lal Pathlabs — Q2 FY2021 Earnings Presentation
45 slides from Dr. Lal Pathlabs's earnings presentation, Nov 13, 2020
Slide 1: Cover letter to stock exchanges: Corporate Presentation Q2 FY21
November 13, 2020 The National Stock Exchange of India Limited The Bombay Stock Exchange Limited Exchange Plaza, Corporate Relationship Department Plot No. C/1, G Block, Phiroze Jeejeeboy Towers Sandra Kurla Complex, Sandra (E) Dalal Street, Mumbai - 400051 Mumbai - 400001 Subject: Corporate Present
Slide 2: Dr. Lal PathLabs Limited Corporate Presentation November 2020
Dr. Lal PathLabs Limited (DLPL) Corporate Presentation November 2020
Slide 3: Disclaimer
Disclaimer By attending the meeting / telephonic call where this presentation is made, or by reading the presentation materials, you agree to be bound by the following limitations: The information in this presentation has been prepared by Dr. Lal PathLabs Limited (the “Company”) for use in presentat
Slide 4: Table of Contents
Table of Contents Company overview 4 Investment highlights 9 Q2 FY21 highlights & financial performance 21 DLPL strategy for future growth 34 DISCLAIMER: This presentation may contain ‘forward-looking’ statements at places. The Company’s business operations remain subject to undetermined contingenci
Slide 5: Company Overview
Company Overview Dr. Lal PathLabs at a glance Our Evolution Dr. Lal PathLabs overview Experienced Management team 4
Slide 6: Dr. Lal PathLabs – At a Glance
Dr. Lal PathLabs – At a Glance India’s Leading & Trusted 12% 15% 120% Diagnostics Company Largest* 3 Year Revenue 3-Year PAT Equity Dividend CAGR CAGR for FY 19-20 diagnostics 70+ years of experience chain in the in the field of diagnostics country with ~67% Rs 894.1 Cr. PAN India ROCE Cash & Invest
Slide 7: Our Evolution
Our Evolution 1949 – 2005 2010 – 2015 Strong position in North India, Foundation 2005 – 2010 building network 2015 onwards in other Higher contribution Building geographies from Rest of India, capabilities for Commissioned state scale up Investment by TA Associates 1949: Founded by Dr. Major S.
Slide 8: Dr. Lal PathLabs overview
Dr. Lal PathLabs overview Established consumer healthcare brand in diagnostic services Routine testing Specialized testing Bio- Molecular Pan-India integrated coverage with 216 clinical labs chemistry diagnostics (including National Reference Lab1 at Delhi and Regional Ref Lab at Test Menu Kolkata),
Slide 9: Experienced Management team
Experienced Management team (Hony.) Brig. Dr. Arvind Lal Dr. Om Manchanda Dr. Vandana Lal Bharath Uppiliappan Ved Prakash Goel Executive Chairman Managing Director Whole-time Director Chief Executive Officer Chief Financial Officer Shankha Banerjee Munender Soperna Rajat Kalra Manoj Garg Company Sec
Slide 10: Investment Highlights
Investment Highlights y. 4 4
Slide 11: Investment Highlights
Investment Highlights Well-positioned in one of the Established consumer healthcare fastest-growing segments of the brand in diagnostic services Indian healthcare industry Attractive operating metrics and Scalable model integrated through multiple levers in place to drive next centralized IT platfor
Slide 12: Indian Healthcare Services is a large growth opportunity
Indian Healthcare Services is a large growth opportunity India’s expected India’s Public healthcare Private expenditure on India GDP in FY201 population in 2022 expenditure in FY 20 healthcare in 2015 India, highly Total Healthcare Expenditure as % of GDP (2015) underpenetrated 17.1% market 11.2% 8.
Slide 13: Diagnostic Services industry expected to grow to INR 924 Bn in 2022
INR 596 Bn Diagnostic Services industry expected to grow to INR 924 Bn in 2022 Diagnostic Services Industry Size Growth Drivers INR 924 Bn INR 596.1 Bn Increase in Demand evidence-based for lifestyle treatments diseases-related services to grow 2017-18E 2021-22P Focus on Screening, early detection,
Slide 14: Diagnostic Services industry remains highly fragmented
Diagnostic Services industry remains highly fragmented Highly Fragmented Industry Large Standalone Pan-India Centres, 48% Chains 35-40% Diagnostic Chain, 15% Regional Chains 60-65% Hospital Based, 37% Largely fragmented and unorganized Source: CRISIL Report titled “Assessment of Diagnostics Industry
Slide 15: Established consumer healthcare brand in Diagnostic Services
Established consumer healthcare brand in Diagnostic Services Pillar of a Strong Brand Medico Marketing Doctor Online Accreditations from Call Centre Query Handling Registration CAP, NABL and ISO Offline Accreditations Centrally administered surveillance programs Online Customer Lab Coverage in
Slide 16: Scalable Model integrated through centralized IT platform allows for network expansion
Scalable Model integrated through centralized IT platform allows for network expansion Hub and Spoke Model Network Expansion PSC PSC No. of Reference Clinical No. of PSCs No. of PUPs Lab Laboratories 6,995 216 6,426 3,095 Clinical Clinical 5,624 Lab Lab 2,569 2,153 200 PSC PSC PSC PSC 193 • Centrali
Slide 17: Scalable Model integrated through centralized IT platform allows for network expansion
Scalable Model integrated through centralized IT platform allows for network expansion Integrated National Network… …backed by Centralized IT platform which fully integrated network Enterprise Resource Planning (ERP) System Payables, receivables, inventory, ledgers etc. Scalability and connectiv
Slide 18: Collection network
Collection network LPL’s scalable business model provides strategic advantage for expansion and consolidation National Reference Lab & Regional Ref. Lab Single brand pulls patients Clinical Labs (Testing/Collection) Walk-in customers account for Patient Service Centers Pickup Points highest share of
Slide 19: Attractive operating metrics
Attractive operating metrics No. of patients No. of samples Total Revenue (Mn) (Mn) (INR Cr.) CAGR: 13.0% CAGR: 17.2% CAGR: 12.2% 1,330.4 19.4 47.7 1,203.4 17.6 41.8 1,056.9 15.2 34.7 FY18 FY19 FY20 FY18 FY19 FY20 FY18 FY19 FY20 FY20 Revenues increased on account of : Consumer brand and network
Slide 20: Robust financial performance
Robust financial performance Total Revenue South Others 3% EBITDA*,PAT and Return on Net Worth (INR Cr.) India (INR Cr./%) West 6% CAGR: 12.2% India 8% 313.2 331.1 1,330.4 1,203.4 278.3 1,056.9 East 227.6 200.5 India Revenue by 171.8 14% Geography (FY20) Delhi & NCR FY18 FY19 FY20 Rest of 40% EBITDA
Slide 21: Robust financial performance (Cont'd)
Robust financial performance (Cont’d) Fixed Asset Turnover1 Cash and Cash Equivalents Times (INR Cr.) Self funded growth on account of strong cash flow 8.5x generation 7.5x 580.0 6.6x 522.9 Attractive fixed asset 405.8 turnover ratio given asset- light model Current net cash position 184.8 144
Slide 22: Q2 FY21 Highlights & Financial Performance
Q2 FY21 Highlights & Financial Performance 21
Slide 23: Q2 FY21 Snapshot
Q2 FY21 Snapshot 18.2% 18.7% *7.5% INR 431.9 Cr INR 134.7 Cr INR 87.1 Cr Revenues Normalised EBITDA* PAT 1.1% 1.1% ~ 5.4 mn ~ 13.2 mn Patients Samples * PAT in Q2 last year has high base due to Income tax rates reduction benefit pertaining to Q1 as well 22
Slide 24: Overview of Dr. Lal PathLabs
Overview of Dr. Lal PathLabs Established brand Pan-India integrated Varied Offerings Unique and successful coverage operating model 216 clinical labs (including National Reference Lab at Catalogue of 455 test panels, Scalable model integrated Established consumer Delhi and Regional Reference 2,537 p
Slide 25: COVID & Non-COVID Revenue
COVID & Non-COVID Revenue 568 • Non-COVID business back to 98% of last year levels in Q2 FY21 • Contribution from COVID business in Q2 358 FY21 is ~17%. 210 • 3.08 lac COVID RTPCR tests conducted in 130 Q2 FY21 and 5.05 lac in FH FY21 56 74 • RT-PCR test being conducted in 9 labs. • Commenced on-dem
Slide 26: Key Performance Highlights
Key Performance Highlights During Q2 FY21: • Revenues increased by 18.2% Y-o-Y at Rs. 431.9 crore • Normalised EBITDA (after eliminating the impact of stock based compensation & CSR) at Rs. 134.7 crore • Profit After Tax at Rs. 87.1 crore, representing a growth of 7.5% over the corresponding quarter
Slide 27: Financials
Financials Particulars (Rs. Cr.) Q2 FY21 Q2 FY20 Gr % FH FY21 FH FY20 Gr % Total Revenue 431.9 365.6 18.2% 697.9 700.8 -0.4% Total Expenditure 304.7 256.7 522.4 496.8 EBITDA 127.3 108.9 16.9% 175.5 204.0 -14.0% Adj for Stock based comp. & CSR cost 7.4 4.6 13.0 8.5 Normalised EBITDA 134.7 113.5 18.7%
Slide 28: Financial Highlights
Financial Highlights All figures in Rs. Crore +18.2% • Revenue increased in Q2 FY21 by 18.2% to Rs. 431.9 431.9 crore. This is on account of : – Volumes which increased by 1.1% and – Revenue from COVID testing Revenue 365.6 • Realisation per patient in Q2 FY21 at Rs. 803, higher as compared to Rs. 6
Slide 29: Financial Highlights
Financial Highlights All figures in Rs. Crore +14.0% • PBT for Q2 FY21 at Rs. 116.6 crore vs. Rs. 102.3 crore in 116.6 the corresponding quarter of last year, representing a growth of 14.0% PBT • Q2 FY21 PBT margin at 27.0%, as against 28.0% in the 102.3 same period of last year Q2 FY20 Q2 FY21 +7.5
Slide 30: Management Commentary
Management Commentary Commenting on the results announcement, (Hony) Brig. Dr. Arvind Lal, Executive Chairman “The CoVID-19 pandemic has been fairly prolonged not only affecting the daily lives of people but also impacting the businesses and economies across the globe. Q2 saw the lockdown being lift
Slide 31: Vibrant Outlook
Vibrant Outlook Strongly develop Rest of India geographies, through Regional Reference Labs and cluster city approach for attractive markets Target to grow Evaluate best fit inorganic Deeper Penetration within the ahead opportunities in South & West North, East & Central Indian of the markets indust
Slide 32: Leveraging digital to make life easier for patient
Leveraging digital to make life easier for patient Logistics Lab Operations Business Digital Lab e-Commerce Mobile app Automation Automation Continuity Plan • Self Registration • Online test / health • Test booking, view • Field Executive • Totally integrated • ‘Multi Site’ model Kiosk for patients
Slide 33: Shareholding as of 30th September, 2020
Shareholding as of 30th September, 2020 22.4% FIIs 14.1% 55.2% Others Promoter and Promoter Group 8.3% Mutual Funds* *Mutual Funds includes Alternate Investment Funds as well 32
Slide 34: Vision, Mission & Values
Vision, Mission & Values VISION Customer First Be the most trusted healthcare partner, enabling healthier lives Ethics & Integrity VALUES Quality To be the undisputed market leader by providing accessible, affordable, timely and quality healthcare, Accountability diagnostics, applying insights and c
Slide 35: DLPL Strategy for future growth
DLPL Strategy for future growth 34
Slide 36: DLPL Strategy for future growth
DLPL Strategy for future growth 1 2 Strengthen Expansion in Existing Offering Operations Expand 4 3 management of Geographic hospital based expansion and clinical laboratories 35
Slide 37: DLPL Strategy for future growth
DLPL Strategy for future growth Expand management of hospital Strengthen Existing Operations Expansion in Offering Geographic expansion based and clinical laboratories Boosting quality & reliability Improve breadth of Tap incremental contracts for Focus city & cluster approach standards diagnostic t
Slide 38: Consistent investments in R&D
Consistent investments in R&D DSIR recognized In House R&D unit R&D Collaboration with marquee Successful commercialization of with an experienced team of institutions tests research scientists and doctors Jawaharlal Nehru University for development of diagnostics kit for detection of mycobacterium
Slide 39: Genevolve: The Genomics initiative
Genevolve: The Genomics initiative GENEVOLVE brings the dawn of a new era of Genomic testing! Genevolve: Genomics division focuses on Genetic testing Offers wide range of key tests related to Oncogenomics, Neurogenomics, Rare disease & Pre-natal/ Post-natal New Tests New Tie-ups ONCOPATH • Sperm DNA
Slide 40: In-house adoption of Digital Histopathology
In-house adoption of Digital Histopathology Reporting of Digital Opportunities created by Breast cancer Panels Digital Histopathology using AI based algorithms Digital Histopathology • Enhanced access to second for remote routine opinion, synchronous review reporting of slides • Enhanced quality
Slide 41: Highest Quality Standards in the Industry
Highest Quality Standards in the Industry 100+ Quality Digitally enabled Real time quality Risk based improvement solutions control quality assurance meetings on a daily implemented for monitoring framework basis with the quality audits network partners and trainings Best in the Industry CAP Profici
Slide 42: Best in class Logistics and Supply Chain management
Best in class Logistics and Supply Chain management Real Real time time service sample monitoring tracking Control tower Real time Field Automated Cash Productivity Executive collection and route tracking process planning with clients visibility 24
Slide 43: Enhanced Customer Experience in Home Collection
Enhanced Customer Experience in Home Collection Auto Routing engine to dynamically allocate the booking to nearest available phlebotomist Real time slot confirmation Real time phlebo visibility to to patient the patient Variable model which grows ECG at home service with business volume launched in
Slide 44: Key Awards & Recognition
Key Awards & Recognition Dr. Om Manchanda honoured ICICI Lombard & CNBC EY Entrepreneur of The Data Quest Technology VC Circle Healthcare and awarded as ‘Healthcare TV18 India Risk Year 2019 – Life Award 2015 – Excellence Summit 2013 – Best Personality of the Year, 2020’ Management Awards 2020 Scien
Slide 45: Contact Us
Contact Us About Dr. Lal PathLabs Limited (DLPL) Dr. Lal PathLabs Limited is one of India’s leading consumer healthcare brand in diagnostic services. It has an integrated nationwide network, where patients and healthcare providers are offered a broad range of diagnostic and related healthcare tests