1. At a Glance
Medinova Diagnostics, a microcap diagnostic chain, posted Q1 FY26 revenue of ₹2.72 Cr (YoY +9%), PAT ₹0.66 Cr (YoY +57%). Operating margins? A sizzling 38.6%. Stock at ₹42 is moving like a lazy ECG wave. Oh, and they’re merging with Vijaya Diagnostics—because scale is the new stethoscope.
2. Introduction with Hook
Imagine a clinic that’s been around since 1985, surviving everything from floppy disks to AI scans. Medinova is that underdog diagnostic center that doesn’t have Dr. Lal’s swag but still runs profitable tests. Two headlines:
- Merger with Vijaya Diagnostics approved in 2025.
- ROCE at 107%—yes, you read that right, it’s absurdly high.
3. Business Model (WTF Do They Even Do?)
Medinova does diagnostics:
- Blood tests to MRIs, they’ve got it.
- Four centers (Hyderabad, Pune, Kolkata).
- Special services: corporate tie-ups, home visits, health camps.
Punchline: “They do what Apollo does—just without the Apollo prices or marketing budget.”
4. Financials Overview
Q1 FY26 Snapshot:
- Revenue: ₹2.72 Cr (+9% YoY)
- PAT: ₹0.66 Cr (+57% YoY)
- OPM: 38.6% (hotter than their MRI machines)
- EPS: ₹0.66
Commentary: Margins impressive, revenue tiny. Like a five-star pani puri stall.
5. Valuation
At P/E 19.8, it’s cheap vs peers, but business scale is minuscule.
- P/E method: 18x FY26E EPS → ₹38–₹45
- EV/EBITDA method: 10x → ₹40–₹50
Fair Value Range: ₹38–₹50
Beyond that, you’re betting on the merger magic.
6. What’s Cooking – News, Triggers, Drama
- NCLT approved merger with Vijaya Diagnostics (April 2025).
- CFO musical chairs: resignations in 2023 & 2024.
- Tie-ups with corporates & government programs—slowly expanding.
- High ROCE, but negative net worth makes it a paradox.
Drama level: merger-driven soap opera.
7. Balance Sheet
| Assets | ₹6.93 Cr |
|---|---|
| Liabilities | ₹18.13 Cr |
| Net Worth | -₹11.2 Cr |
| Borrowings | ₹5 Cr |
Net worth negative, debt manageable. The merger is their lifeboat.
8. Cash Flow – Sab Number Game Hai
| FY23 | FY24 | FY25 |
|---|---|---|
| Ops | ₹1.42 Cr | ₹2.67 Cr |
| Investing | -₹0.34 Cr | -₹0.21 Cr |
| Financing | ₹0.31 Cr | -₹0.85 Cr |
Cash flow is positive but fragile—like a test tube in a clumsy intern’s hand.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROE | NA (negative net worth) |
| ROCE | 107% |
| OPM | 33.5% |
| P/E | 19.8 |
ROCE is eye-popping, but it’s an accounting quirk—business is still tiny.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹10.17 Cr | ₹2.83 Cr | ₹2.0 Cr |
| FY24 | ₹9.81 Cr | ₹2.99 Cr | ₹1.9 Cr |
| FY25 | ₹10.04 Cr | ₹3.36 Cr | ₹2.14 Cr |
Growth flat, but margins keep improving—at least something’s working.
11. Peer Comparison
| Peer | Rev (₹Cr) | PAT (₹Cr) | P/E |
|---|---|---|---|
| Dr Lal Pathlabs | 2,461 | 489 | 52.8 |
| Metropolis | 1,331 | 140 | 72.9 |
| Vijaya Diagnostics | 681 | 144 | 76.4 |
| Medinova | 10 | 2.1 | 19.8 |
Medinova: the small cousin in a family of diagnostic giants.
12. Miscellaneous – Shareholding, Promoters
- Promoters: 62.14% (stable).
- Public: 37.86%.
- Merger with Vijaya expected to reshape shareholding.
Promoters seem in control; public just waiting for the merger to finish.
13. EduInvesting Verdict™
Medinova is a small, niche diagnostic player with high margins but weak balance sheet. The Vijaya merger is the real story—post-merger, scale could change everything.
Final word: “A small clinic about to join a hospital chain—watch the surgery, not the symptoms.”
Written by EduInvesting Team | 26 July 2025
Tags: Medinova Diagnostics, Q1 FY26, Healthcare Services, EduInvesting Premium
