“Inorganic strategy for us is much focused. Our presence is weaker in western and southern market, so it is in those markets where we are very actively scouting for assets. As and when something happens, we will let you know,” Lal PathLabs Chief Executive Officer Om Manchanda told Business Standard.
The western and southern regions together contribute around 25-30 per cent of the company’s total turnover. The pathology chain is aiming to clock a total revenue of Rs 450 crore during the current financial year ending March, Manchanda said. According to him, the company is growing at a compound annual growth rate of 35-36 per cent for the last three-four years. Although the company is not looking at diagnostic chains in specific, it may acquire smaller labs with presence through more than one lab in the city.
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The company is also planning organic growth in tier II cities of northern and eastern India. It will add 30-40 labs in Jamshedpur, Dhanbad, Darbhanga, Jaipur and Mumbai during financial year 2013-14, Manchanda said. Budgeting for acquisition, the company has set aside Rs 50 crore to open these new labs across the country. It has 125 satellite labs in India and 2,000 collection centres, serving around 10 million patients annually.
A recent report by PricewaterhouseCoopers says the diagnostic market, pegged at $3.4 billion annually, is the fastest growing segment in the Indian healthcare space.
The market is fragmented with only a few major players.