Vijaya Diagnostic Centre Q2 FY27 Earnings Call: Guides 20%+ Revenue Growth, Margin Expands 350 Bps

Vijaya Diagnostic Centre Ltd held its Q2 FY27 earnings call on November 03, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Volume-Led Growth With Operating Leverage

• Q2 FY 2026-2027 revenue of ~Rs.255 crore, up 26.7% YoY — driven by 16.5% YoY test volume growth, favorable test mix, and the CGHS tariff revision; existing centers grew 20% in Q2 FY27.
• EBITDA of ~Rs.113 crore (vs Rs.82 crore in Q2 FY 2025-2026), up 37.8% YoY — margin of 44.1%, up 350 bps YoY, attributed by management primarily to operating leverage; PAT of Rs.59 crore, up 37.4% YoY, PAT margin 23.3%.
• H1 FY 2026-2027 revenue of Rs.486 crore vs Rs.390 crore (+24.8% YoY) — EBITDA Rs.211 crore vs Rs.155 crore (+36% YoY), margin 43.4%; PAT Rs.113 crore, PAT margin 23.1%.
• H1 growth decomposition (CFO Narasimha Raju) — ~16.5% from volume, 4-5% from favorable test-mix shift toward high-end radiology (CT, CT angio), and ~3% from the CGHS tariff hike implemented in October-November FY 2025-2026.
• Q2 revenue mix — Hyderabad 67%, rest of AP & Telangana ~20%, Pune 5%, West Bengal 5%, other geographies 3%; B2C at 92% of revenue; radiology ~37%; revenue per test Rs.513 and revenue per footfall Rs.1,865.
• Balance sheet as of Q2 FY 2026-2027 — surplus cash ~Rs.355 crore; cash PAT above 30%; ROCE ~25% and RoE ~20%.

Accelerated Hub Cadence and Third Hyderabad Flagship

• Footprint of ~168 centers as of Q2 FY 2026-2027 — 51 hubs, 117 spokes; Hyderabad is the largest cluster with ~100 centers (19 hubs, ~80 spokes), rest of AP & Telangana 33 centers, Kolkata 12, Pune 5 hubs plus spokes, Karnataka 4 centers.
• 2 hubs and 7 spokes commissioned in H1 FY 2026-2027 — including the flagship hub at JP Nagar, Bengaluru; guidance of 8 hubs and 14 spokes by Q1 FY28, with 3 more hubs operational by March 2027 (Q4 FY 2026-2027) and the balance 3 in Q1 FY28; estimated program capex ~Rs.155-160 crore.
• Third flagship center in Hyderabad — lease signed after a year-long location search, driven by exceptional growth in western-Hyderabad spokes; opening targeted within the next 6-8 months (FY 2027-2028), with high-end equipment under evaluation including a possible 3T MRI similar to the one at JP Nagar, Bangalore.
• Hub cadence caution — 10 hubs were added in FY 2025-2026 and 8-9 hubs are targeted for FY 2026-2027; management said it is "not sure" 10 hubs/year becomes the norm, advised analysts not to model 10 hubs every year, and will provide hub-addition guidance only 2-3 quarters ahead.
• Pune capacity moves — relocation of 2 congested hubs (Satara and Mayur Colony) to larger premises planned; Pune Market Yard hub with central laboratory (~Rs.18-20 crore capex) targeted for launch during FY27 (FY 2026-2027); Mayur Colony replacement hub (building bought for ~Rs.19 crore) expected commissioned in FY28 (FY 2027-2028).
• Kadapa (tier-2 AP) land purchased for ~Rs.9 crore — hub center to be set up there over the next 2 years (~by FY 2028-2029); the purchase was an exception after 2-3 years of scouting with no leased premises available.
• Asset-light strategy unchanged — all hubs/centers remain on lease, but management said owning at least one or two hub locations in the three metro markets (Pune, Bangalore, Kolkata) is "extremely important from a long-term strategy perspective".

Deepening Pune, Bangalore and West Bengal; Northeast Entry via Guwahati

• Hyderabad grew over 20% YoY in Q2 FY 2026-2027 — mid-teens volume growth with ~2-3% from test-mix change and the balance from the CGHS tariff revision (Sunil Chandra); CFO affirmed existing centers, not new additions, are driving the ~20% growth.
• Hyderabad competitive position — management stated no new player has opened a center in Hyderabad and no competitor is close to 40-50 centers vs Vijaya's ~100, the largest network in the city; growth attributed to brand strength, market-share gains from unorganized players, and continuous equipment additions.
• Pune revenue per center steady at ~Rs.2.5 crore (Q2 FY 2026-2027) — growth predominantly from network expansion (Kalyani Nagar and Ambegaon hubs, ~1-1.5 years old and still ramping up); PH cluster delivering double-digit growth over the last couple of quarters through Q2 FY27 with margins above 35%.
• Bangalore radiology-led ramp-up — newer locations such as HSR Layout and Alanka are initially seeing higher footfall for high-end MRI and CT cases; management expects regular case volumes to keep increasing over the next 1-2 years, with more than 50% of revenue at new centers like Bangalore expected from high-end radiology.
• Arya Wellness Center (Guwahati) acquisition — BTA signed in Q2 FY 2026-2027 on a slump sale basis; CPs under completion with closure expected within 2 months (~Q4 FY 2026-2027); the asset has a top line of more than Rs.25 crore, EBITDA above 20% (pre-India EBITDA basis, as stated), and the hub at close to 25%.
• No numeric margin bridge guided for Guwahati — management gave no target for lifting margins from ~21-22% toward company level over the next 2-3 years; Sunil Chandra reiterated the hub-maturity cluster model, with the regional growth plan to be shared after transaction completion.
• Expansion focus — CFO stated the priority is deepening Pune, Bangalore and West Bengal plus district headquarters in core geographies; no entry into a new geography is planned as of now, and Assam will become the company's seventh state as a platform for the entire northeastern geography.

Fixed-Cost Leverage Supports Margin; Wellness Growing Above 20%

• ~65-70% of expenses are fixed in nature — management noted revenue growth beyond 15-18% accrues to the EBITDA level; Q2 FY 2026-2027 margin included a benefit of close to 2% from the CGHS tariff hike.
• Minimal drag from new centers — the only facility opened in Q2 FY 2026-2027 was the Bangalore JP Nagar flagship; the Q1 FY 2026-2027 Gachibowli hub and its spokes are also not creating meaningful EBITDA drag, and the 10 hubs opened in FY 2026-2027 ramped up as expected or faster.
• Wellness at 14-15% of revenue, grew ~27% in Q2 FY 2026-2027 — management guided the mix may not change materially over the next couple of years (FY 2027-2028 to FY 2028-2029), while the segment is expected to keep growing comfortably above 20% (period unspecified).
• Wellness demand broadening beyond Hyderabad — over the last 2-3 years, rising awareness has driven wellness growth in tier-2 locations; corporate sales are showing a good increase as the network expands in West Bengal and Karnataka (Dhiren Gala).
• Wellness mix caveat — management cautioned wellness will not materially drive revenue per test at the current 14-15% mix, since wellness packages are offered at discounted pricing and only packages (not procedures like cardiac angio CT) are reported as preventive/wellness revenue.
• Radiology mix at ~37-38% of revenue — the CFO does not expect a material change over the next 3-4 years (through roughly FY 2030-2031), with only ~1-2% drift depending on expansion mix, since hubs carry higher radiology share while spokes are pathology plus basic radiology.

FY27 Guidance and Medium-Term Growth Framework

• FY 2026-2027 revenue guidance of at least 20% growth, "fairly achievable" — versus the ~25% H1 FY 2026-2027 run-rate; H2 pacing was not explicitly addressed.
• FY27 EBITDA margin guidance of ~42% and above — management is fairly confident based on the H1 FY27 EBITDA margin of 43-44%.
• Long-term framework (next 3-5 years) — management is comfortable with mid-teens revenue growth above 15%, comprising ~2% from price realization (historical price CAGR ~2%) and ~13% from volume — 8-10% from the existing network and 3-3.5% from new centers.
• Pricing lever pending — last price hike was in June FY 2025-2026 and none taken so far in FY 2026-2027; management will benchmark prices against the market and take a "calculated decision" on a potential hike in Q3 or Q4 FY 2026-2027.
• FY 2027-2028 expansion plans — 4-5 hubs plus a couple of spokes spread across the network, including the third flagship hub in western Hyderabad; continued additions in the core geography and new markets (Pune, Kolkata, Bangalore).
• Hyderabad mix shift expected — management expects Hyderabad's revenue contribution to continue declining ~3-4% annually, with other markets increasing their share (period unspecified); Hyderabad's contribution fell to 67% in Q2 FY 2026-2027 from 69% in Q2 FY 2025-2026.
• Double-digit Hyderabad growth affirmed — management expects it to continue (period unspecified), citing a consistent double-digit track record over the last 3-4 years despite the market being viewed as mature.

High-End Modality Upgrades Across the Network

• 2 CT scanners upgraded to high-end 160-slice cardiac CT (completed as of Q2 FY 2026-2027) — citing increased demand for high-end complex CTs; one existing hub was upgraded to a 160-slice CT in FY 2026-2027, lifting higher-realization CT coronary angio/calcium volumes.
• Second MRI added at Kannur — and the company may add a second MRI at Tirupati within the next 6 months (by ~Q1 FY 2027-2028).
• Second-equipment decision framework (illustrative) — a center is comfortable at 15-16 MRI scans/day; sustained ~25 scans/day with 1-2 hour patient waits triggers adding a machine, after which both may together do ~50 scans/day; if the existing ~8,000 sq ft premises cannot host it, the company opens another 7,000-8,000 sq ft hub within ~1 km.
• New Panjagutta Central Laboratory — with automated track system expected operational within the next few months (H2 FY 2026-2027); capex ~Rs.20 crore.
• Growth decomposition (Sunil Chandra) — growth is coming from three factors: incremental investments in existing centers, new centers, and change in test mix; rising demand for advanced procedures (e.g., cardiac angio) and new high-end pathology tests including genomics is shifting business toward larger established players.