Diagnostic players test untapped territories for growth
Vijay C Roy
Chandigarh, April 11
Leading diagnostic players are on an expansion spree. With growth opportunities for routine tests stagnating in urban areas due to stiff competition from labs attached to the hospital chains, they are looking to expand into the untapped territories such as tier-II, tier-III & tier-IV cities.
Recently, medical diagnostics firm Metropolis Healthcare announced the launch of two advanced diagnostic testing centres at Malegaon in Maharashtra, and Dehradun in Uttarakhand. Also, encouraged by the response in tier-III and tier-IV cities, Dr Lal Path announced 20 new lab programmes in these towns. It is also going to increase its strength of collection centres and other market activation programmes. Agilus Diagnostics, a Fortis Healthcare Ltd subsidiary, unveiled a state-of-the-art laboratory in Bongaigaon, Assam, in November last year.
Also, diagnostic and preventive healthcare service provider Thyrocare announced recently the acquisition of 100 per cent stake in Chennai-based Think Health Diagnostics. With this strategic acquisition, Thyrocare will expand its footprint in the pre-policy medical check-up segment for the insurance market.
According to experts, increasing health awareness after pandemic has provided a fillip to preventive health checkup. To facilitate the same, diagnostic companies are not only expanding but also bundling various tests into curated wellness packages tailored to different genders, age groups and consumer profiles.
“Existing diagnostic players are eyeing growth opportunities for routine tests stagnating in metros and urban centres due to stiff competition from e-pharmacies as well as labs attached to hospital chains.
As a result, they are looking to expand into the hitherto untapped tier 2/3/4 cities and increase their customer base to drive volumes. The increase in collection centres at these locations will also lead to better utilisation of existing test labs,” said Poonam Upadhyay, Director, Crisil Ratings.
Growing demand for health packages
- As per Crisil, while geographic expansion by big diagnostic players into tier 2/3/4 cities will drive higher patient volumes, growing demand for preventive health packages will lead to higher realisation per patient
- Revenue of diagnostic firms is poised for a 10-11% growth in FY25, driven by higher number of patients and improving revenue per patient
