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Axis Direct Issues Buy Ratings for Top Healthcare Stocks With Up to 21% Upside
- •Axis Direct has assigned Buy ratings to Dr Lal PathLabs, Vijaya Diagnostic Centre, and Nephrocare Health Services, projecting potential gains of up to 21%.
- •Dr Lal PathLabs has a target price of Rs 2,315, supported by a strong pan-India pathology network, high B2C revenue contribution, and zero-net-debt balance sheet.
- •Vijaya Diagnostic Centre received a target price of Rs 1,730, driven by its extensive presence in South India, integrated pathology and radiology services, and high margins.
- •Nephrocare Health Services holds a target price of Rs 750, backed by its position as Asia's largest specialised dialysis provider with over 490 clinics globally.
- •The brokerage highlights structural growth drivers in India's healthcare sector, including rising chronic disease incidence, early detection awareness, and expanding insurance.
Key Questions Answered
Axis Direct issued 'Buy' ratings for all three companies, setting a target price of Rs 2,315 for Dr Lal PathLabs (20% upside), Rs 1,730 for Vijaya Diagnostic Centre (20% upside), and Rs 750 for Nephrocare Health Services (21% upside).
The Indian diagnostic services market is projected to grow at a 10%-12% CAGR from Rs 86,000-87,000 crore in FY24 to Rs 1,27,500-1,37,500 crore by FY28. Key drivers include rising chronic disease incidence, early detection awareness, shifts toward organized providers, expanding government schemes, and increased health insurance penetration.
Nephrocare Health Services operates 490 clinics across 269 cities in India, the Philippines, Uzbekistan, and Nepal, encompassing 255 captive hospital clinics, 176 PPP clinics, and 59 standalone facilities. Its FY25 revenue grew at a 31.5% CAGR to Rs 756 crore, accompanied by an EBITDA margin of 22.1%.
