Kushal Gupta, senior research analyst at G Business, said in his exclusive research report on Monday that a big hit of about 40-50 per cent is expected on the profits of diagnostic companies like Metropolis Healthcare and Dr Lal Path Labs.
This is mainly due to the launch of the B2C (Business to Consumer) segment behind Tata 1mg’s disruption in the sector. On a pilot basis in Bangalore, the company has introduced important tests like Thyroid Profile, Liver Function, Lipid Profile, and Diabetes Screening at Rs 100 per test.
Gupta said Tata 1mg’s app / website showed Rs 100 for lipid profile test in Bangalore, while Metropolis and Dr Lal were charging around Rs 600 and Rs 960 respectively for the same test.
The founder of Thyrocare – Dr. A. Velumni tweeted a picture of the Tata 1mg ad and said, “Interesting. The new game begins. What I did was pure BtoB disturbance. Which has only made the middleman a millionaire. Not BtoC. Did not dare. Didn’t take the risk. Achchhedin for a common man.
#ZBiz Exclusive A big game changer at Diagnostic Company
Tests like thyroid, lipid profile for only 100 rupees …
How much is the loss of Path Lab companies due to the cheap price of Tata 1mg?
– Zee Business (ZeeBusiness) May 18, 2022
G Business Research Response to Diagnostic Companies – Velumni tweeted, “BtoC will burn $ 1B (billion) for each of the disrupted runways. Reaching out to ordinary people. 2. To neutralize the negativity of the corrupt medical community 3. To set up labs in every district. 4. Operation cost for full 5 years. ”
Managing Editor Anil Singhvi said he had great respect for Dr. Velumine and said, “Perhaps he understood the disruption and, therefore, sold shares of Thyrocare to Pharmacy.” He noted that companies like Metropolis and Dr Lal could see the impact of the disruption from Tata 1mg.
He added, “People trust brands like Tata and would like to do lab-related tests without having to go to any local laboratory.”
Describing the development as disruptive, TradeSoft director Sandeep Jain said that Tata was proving its prowess across the segment whether it was a traditional or new age business. Describing it as negative news for his peers, Jain said the real impact of the B2C segment needs to be accessed.
Market analyst Himanshu Gupta said the chart of Metropolis shares had deteriorated before it was sold in the market. The stock has corrected 50% from a high of Rs 3,500 per share, however, it showed a pullback by Rs 2,500 per share in March but could go below Rs 1,500 per share.
Similarly, another market analyst Kunal Saraogi noted that Dr. Lal Path Labs charts were also weak, with low peaks showing a break below Rs 2,400 per share. Big support at Rs 1750-1800 per share level, Saraogi said, the stock is expected to fall another Rs 400.