Axis Direct is bullish on Dr Lal PathLabs, Vijaya Diagnostic Centre and Nephrocare Health Services, assigning 'Buy' ratings to all three stocks and setting target prices that imply an upside of up to 21%, citing structural growth drivers in India's healthcare and diagnostics sector.
The brokerage has set a target price of Rs 2,315 for Dr Lal PathLabs, implying an upside of 20% from the current market price of Rs 1,934. It highlighted the company's pan-India pathology network, retail B2C business contributing over 70% of revenue, zero-net-debt balance sheet and EBITDA margins of around 26%-27%.
For Vijaya Diagnostic Centre, Axis Direct has set a target price of Rs 1,730, implying an upside of 20% from the current market price of Rs 1,437. The company operates more than 140 centres across South India, combining pathology and advanced radiology services, including MRI, CT and PET-CT imaging. The brokerage highlighted its customer stickiness and EBITDA margins of around 39%-40%.
Axis Direct has set a target price of Rs 750 for Nephrocare Health Services, also known as NephroPlus, implying an upside of 21% from the current market price of Rs 616. India's and Asia's largest specialised dialysis service provider operates 490 clinics across 269 cities in India, the Philippines, Uzbekistan and Nepal. Its network includes 255 captive hospital clinics, 176 public-private partnership (PPP) clinics and 59 standalone facilities.
Nephrocare's revenue from operations grew at a 31.5% CAGR to Rs 756 crore in FY25, while its EBITDA margin stood at 22.1%.