Dr. Lal Pathlabs Limited · NSE:LALPATHLAB
Dr. Lal Pathlabs — Q3 FY20 Earnings Presentation
40 slides from Dr. Lal Pathlabs's earnings presentation, Feb 11, 2020
Slide 1: Exchange filing cover letter for Corporate Presentation Q3 FY20
February 11, 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 (DLPL) Corporate Presentation February 2020
Dr. Lal PathLabs Limited (DLPL) Corporate Presentation February 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 Q3 & 9M FY20 highlights & financial performance 24 DLPL strategy for future growth 36 DISCLAIMER: This presentation may contain ‘forward-looking’ statements at places. The Company’s business operations remain subject to undetermined contin
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 15% 14% Zero Professionally managed operations; 7 decades of experience in the world of NO. 1 3 Year Revenue 3-Year PAT Net Debt BRANDED diagnostics CAGR CAGR NATIONAL 59% Well diversified outside home market of ‘Delhi NCR’ DIAGNOSTICS ~70% CHAIN WITH Revenue Contribut
Slide 7: Our Evolution
Our Evolution 1949 – 2005 2010 – 2015 Strong position in 2005 – 2010 2015 onwards North India, Foundation building network 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 Pan-India integrated coverage with 200 clinical labs Bio- Molecular (including National Reference Lab1 at Delhi and Regional Ref Lab at chemistry diagnostics Kolkata), 2,569 Pat
Slide 9: Experienced Management team
Experienced Management team (Hony.) Brig. Dr. Arvind Lal Dr. Om Manchanda Dr. Vandana Lal Ved Prakash Goel Bharath Uppiliappan Whole-time Director and Chief Chairman and Managing Director Whole-time Director Chief Financial Officer CEO India Business Executive Officer Shankha Banerjee Munender Soper
Slide 10: Investment Highlights
| Y 4 a | Investment Highlights
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 FY20 India healthcare Private expenditure on India GDP in FY201 population in 2022 expenditure healthcare in 2015 India, highly Total Healthcare Expenditure as % of GDP (2015) underpenetrated 17.1% market 11.2% 8.9% 8.2% 5.6%
Slide 13: Diagnostic Services industry expected to grow to INR 802 bn by FY20
INR 596 bn Diagnostic Services industry expected to grow to INR 802 bn by FY20 Diagnostic Services Industry Size Growth Drivers INR 802.1 Bn INR 596.1 Bn Increase in Demand evidence-based for lifestyle treatments diseases-related services to grow 2017-18E 2019-20P Focus on Screening, early detection
Slide 14: Diagnostic Services industry remains highly fragmented
Diagnostic Services industry remains highly fragmented Highly Fragmented Industry Standalone Large Centres, Pan-India Chains 35-40% 48% Diagnostic Chain, 15% Regional Chains Hospital 60-65% 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 Accreditations Offline 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 2,569 200 6,426 Clinical Clinical 2,153 5,624 Lab Lab 5,021 1,759 193 PSC PSC PSC PSC 189 • 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 Pickup Points Hospitals Doctors Labs National Reference Lab & Regional Ref. Lab Single brand pulls patients Walk-in customers account for Patient Service Centers Walk-ins highest share of re
Slide 19: 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 20: Attractive operating metrics
Attractive operating metrics No. of patients No. of samples Total Revenue (Mn) (Mn) (INR mn) CAGR: 15.0% CAGR: 19.4% CAGR: 14.8% 12,034 10,569 17.6 41.8 9,124 15.2 34.7 13.3 29.3 FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19 FY19 Revenues increased on account of : Consumer brand and network Inc
Slide 21: Multiple levers in place to drive next phase of growth
Multiple levers in place to drive next phase of growth Cluster and focused geography approach Expand presence in existing Deepen presence in North India by developing additional reference labs markets Scale up in East India by developing ecosystems via Kolkata reference lab Targeted expansio
Slide 22: Strategies to deepen our presence
Strategies to deepen our presence Preventive healthcare screening and chronic / lifestyle Online report; disease management services. Bundling of tests data analytics South and West India Commitment to quality Focus on retail and reliability of services network and home collection Focus on hospital
Slide 23: Robust financial performance
Robust financial performance Total Revenue West India Others 2% EBITDA1,PAT and Return on Net Worth INR (Mn) 7% (INR Mn/%) South India 6% EBITDA Margin Before ESOP 27.2% 26.3% 26.0% East India Revenue by &CSR charge1 CAGR: 14.8% 12,034 Geography 13% PAT Margin 17.1% 16.3% 16.7% (FY19) 10,569 9,124 R
Slide 24: Robust financial performance (Cont'd)
Robust financial performance (Cont’d) Fixed Asset Turnover1 Cash and Cash Equivalents Times (Mn) Self funded growth on 5,229 account of strong cash flow 8.5x generation 7.5x 6.6x 4,058 Attractive fixed asset turnover ratio given asset- 2,836 light model 1,848 Current net cash position 1,448 1,
Slide 25: Q3 & 9M FY20 Highlights & Financial Performance
Q3 & 9M FY20 Highlights & Financial Performance 24
Slide 26: Q3 FY20 Snapshot
Q3 FY20 Snapshot 12.1% 13.5% 19.1% INR 327.9 Cr INR 80.1 Cr INR 54.9 Cr Revenues Normalised EBITDA* PAT 11.3% 13.7% ~4.8 mn ~11.6 mn Patients Tested Samples Processed * Excluding Ind AS 116 impact 25
Slide 27: Overview of Dr. Lal PathLabs
Overview of Dr. Lal PathLabs Established brand Pan-India integrated Varied Offerings Unique and successful coverage operating model 200 clinical labs (including National Reference Lab at Catalogue of 459 test panels, Scalable model integrated Established consumer Delhi and Regional Reference 2,489 p
Slide 28: Key Performance Highlights
Key Performance Highlights In Q3 FY20, patient volumes increased by 11.3% led by higher growth in the Rest of India market, further supported by stable momentum in the other regions During Q3 FY20: • Revenues increased by 12.1% Y-o-Y at Rs. 327.9 crore • Number of patients tested stood at 4.8 millio
Slide 29: Financials
Financials YTD YTD YTD Q3 FY20 Q3 FY20 Q3 FY19 Gr % Gr % Gr % Gr % Q3 FY20 Q3 FY20 Q3 FY19 Particulars (Rs. Cr.) (With IND- (W/O IND- (W/O IND- (With IND (W/O IND- (With IND- (W/O IND- (W/O IND- (With IND (W/O IND- AS 116) AS 116) AS 116) AS 116) AS 116) AS 116) AS 116) AS 116) AS 116) AS 116) Reven
Slide 30: Financial Highlights
Financial Highlights All figures in Rs. Crore 292.5 327.9 Revenue growth in Q3 FY20 stood at 12.1%, at Rs. 327.9 crore. This was contributed by: Revenue • Continued momentum in volumes, which grew by 11.3% and • Higher growth in tests per patient from 2.38 to 2.43 Realisation per patient in Q3 F
Slide 31: Financial Highlights
Financial Highlights All figures in Rs. Crore 67.9 73.4 PBT for Q3 FY20 came in at Rs. 73.4 crore vs. Rs. 67.9 crore in the corresponding quarter of last year, representing a growth of 8.1% PBT Q3 FY20 PBT margin stood at 22.4%, as against 23.2% in the same period of last year Q3 FY19 Q3 FY20
Slide 32: Operating Highlights
Operating Highlights No. of Clinical Laboratories No. of PSCs No. of PUPs 189 193 200 2,569 6,426 2,153 5,021 5,624 1,759 FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19 No. of Patients No. of Samples 17.6 41.8 15.2 34.7 13.3 29.3 15.0 36.5 FY17 FY18 FY19 9M FY20 FY17 FY18 FY19 9M FY20 31
Slide 33: Management Commentary
Management Commentary Commenting on the results announcement, Dr. Arvind Lal - Chairman and Managing Director said: “We continue to demonstrate healthy performance quarter-on-quarter led by our focus on basic fundamentals of business and aspiration to maintain high levels of quality and scale. There
Slide 34: Vibrant Outlook
Vibrant Outlook Strongly develop Rest of India geographies, through Kolkata National Laboratory and cluster city approach for attractive markets Target to grow Evaluate best fit inorganic Deeper Penetration within the ahead opportunities North, East & Central Indian of the markets industry Higher co
Slide 35: Leveraging digital to make life easier for patient
Leveraging digital to make life easier for patient Digital Lab e-Commerce Mobile app • Self Registration Kiosk for • Online test / health package • Test booking, view and patients booking download current and • Integrated payment gateway • Online payment, order related historical test reports for on
Slide 36: Shareholding as of 31st December, 2019
Shareholding as of 31st December, 2019 20.3% FIIs 13.4% 56.8% Others Promoter and Promoter Group 9.5% Mutual Funds* *Mutual Funds includes Alternate Investment Funds as well 35
Slide 37: DLPL Strategy for future growth
DLPL Strategy for future growth 36
Slide 38: DLPL Strategy for future growth
DLPL Strategy for future growth 1 2 Strengthen Expansion in Existing Offering Operations 4 3 Expand management of Geographic hospital based expansion and clinical laboratories 37
Slide 39: 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 approach standards diagnostic testing in
Slide 40: 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