Krsnaa Diagnostics Ltd Management Discussions

Economic Overview

Global Economy

In CY 2024, the global economy demonstrated considerable resilience, achieving a GDP growth rate of 3.3% notwithstanding sustained macroeconomic headwinds. These challenges encompassed persistently high inflation, ongoing reconfiguration of supply chains and shifts in monetary policies across major economies.

The US led the recovery among advanced economies. This was driven by strong economic fundamentals, low unemployment and an upswing in technology sector. These factors led to healthy corporate earnings and bolstered investor confidence.

A global decline in inflation, from 6.6% in CY 2023 to 5.7% in

CY 2024 contributed to price stability and sustained economic growth. This improvement was supported by accommodative monetary policies and consistent energy availability, both of which strengthened business sentiments.

Emerging Markets and Developing Economies (EMDEs) outperformed advanced nations, with an estimated growth rate of 4.2% compared to 1.7% in the developed countries. Asia played a crucial role in this global momentum, with its export- driven economies constituting approximately 60% of the global growth. However, Chinas growth was projected to slow to 4.7%, primarily due to weak consumer demand and challenges arising from industrial overcapacity.1

Outlook2

Global GDP is forecast to expand at 2.8% in CY 2025 and 3.0% in CY 2026. This is envisioned to be supported by easing inflationary pressures, strengthening household purchasing power, broadly accommodative monetary policies and flexible interest rate regimes implemented by central banks. Emerging markets are projected to outpace global averages, with estimated growth of 3.7% in CY 2025. The growth is expected to be fuelled by industrial expansion, rapid digitisation and deeper integration into global trade. In contrast, advanced economies are anticipated to grow at a moderate pace of 1.4%, facilitated by stable financial position and rising consumer optimism. However, global trade dynamics remain vulnerable due to the escalating tariff measures imposed by the US administration. Reciprocal tariffs can potentially trigger cost inflation, supply chain disruptions and recessionary exposure in critical markets.

Consumer expenditure will remain a key driver of growth, aided by disinflation, forecasted at 4.3% in CY 2025 and 3.6% in CY 2026, thereby enhancing household purchasing power. As advanced economies near their inflation targets, overall global market stability is anticipated to improve. Despite persistent geopolitical uncertainties, ongoing government investments, sound fiscal discipline and substantial demand will potentially foster a resilient and inclusive economic recovery and long-term growth.

Indian Economy

The economy of India surpassed Japan to become the fourth-largest economy, with its GDP reaching $4 trillion. In FY 2025, the nations economy recorded a growth of 6.5%. The momentum came from strong domestic demand, heightened infrastructure investment from the government and the rapid expansion of the digital sector. Notably, key sectors such as services recorded substantial growth, fuelling increased spending across both rural and urban markets.

Inflation dropped to 4.6% from 5.4%. The decline boosted consumer sentiment augmented retail activity. The RBI injected ?1.5 trillion into the banking system to support liquidity. Rural consumption held steady, aided by farm output and welfare support. The rise in urban demand was facilitated by higher incomes and shifting consumer preferences.

Outlook

The economic outlook for FY 2026 remains optimistic with GDP expected to rise by 6.5%. This growth is likely to driven by supportive government policies and monetary easing. Tax reforms introduced by the Union Budget is expected to spur consumption. Raising the income tax exemption to ?12.75 lakh is envisioned to enhance purchasing power of middle-income households. Overall, this measure is expected to augment private consumption and reinforce economic momentum.3

Additionally, the 8th Pay Commissions recommendations are anticipated to boost augment purchasing power. The Reserve Bank of Indias (RBI) repo rate cut will inject liquidity into the system, encourage borrowing and improve overall market sentiment.

Industry Overview

Indian Healthcare Industry4

Indias healthcare industry is expanding rapidly, with its market size rising from around $180 billion in FY 2023 to an estimated $320 billion by FY 2028, reflecting an annual growth rate of about 12%. This strong momentum is being fuelled by rising incomes, greater health awareness and supportive government initiatives aimed at improving accessibility and affordability. The sector encompasses a diverse range of services and products, including hospitals, diagnostic services catering to the healthcare needs of over 1.4 billion people. Public and private investments are steadily strengthening infrastructure, particularly in underserved regions where demand for quality care continues to grow.

Innovation has emerged as a key driver, with segments such as digital health contributing approximately $30 billion in 2023. This is projected to double to $60 billion by 2028. Diagnostics sector is growing rapidly as preventive checks and chronic disease monitoring become routine, reflecting a shift toward proactive healthcare. At the same time, the adoption of digital solutions like teleconsultations, home sample collection and AI-powered diagnostics is transforming both patient experience and operational efficiency across the ecosystem, positioning Indias healthcare sector for sustained long-term expansion.

Key Growth Drivers5

Supportive Government Policies

The government continues to augment healthcare accessibility through targeted policies. Schemes such as free health insurance, affordable medicines, wellness centres and digital health initiatives are helping more people access quality healthcare. These efforts are particularly impactful in rural and economically disadvantaged regions.

Expansion of Healthcare Infrastructure

The nation is experiencing significant growth in its healthcare infrastructure. The country is accelerating the establishment of hospitals, health centres and medical colleges. The sharp rise in the number of hospital beds, clinics and wellness centres is strengthening the delivery of healthcare across both metropolitan and rural regions.

Growth of Digital Healthcare

Digital tools such as online doctor consultations, health apps, electronic health records and mobile health platforms are becoming increasingly common. People can now access healthcare services remotely, saving both time and cost, especially in remote areas.

Rising Health Insurance Coverage

An increasing number of people are availing health insurance, either through government programmes or private providers. This trend is leading to greater utilisation of institutional healthcare and a reduction in out-of-pocket expenses.

Increased Healthcare Funding

Government expenditure on healthcare has risen markedly in recent years. More capital is being channelled into infrastructure development, training of the healthcare workforce and subsidised delivery of healthcare to those in need.

Government Initiatives and Policies6

PMJAY and PMABHIM Allocations as a percentage of the Health Department Budget

The Indian government has allocated an estimated ?90,958 crore for healthcare in FY 2025 budget. This allocation marks a modest 2% increase over the previous fiscal.

Under the Ayushman Bharat scheme (PM-JAY), the budget has risen to ?7,300 crore and coverage now encompasses ASHA and Anganwadi workers. Funding for the Ayushman Bharat Health Infrastructure Mission witnessed a hike of 63%, reaching ?3,756 crore. Meanwhile, the government plans to improve major medical institutions, such as AIIMS and NIMHANS. However, funding for new AIIMS and other medical institutes has been reduced by 28%.

Key focus areas on public health programmes:

y National Health Mission rose by 14% to Rs 36,000 crore

y Support for urban health, de-addiction and tertiary care also witnessed marked elevation

Budgetary allocation for the National Centre for Disease Control nearly doubled, highlighting a renewed focus of the government on disease containment. Emergency disaster health services also received increased funding, reflecting a more proactive approach to managing health emergencies. Conversely, funding for general medical education and human resource development dropped by 16%. However, allocations for health research rose sharply by 69%.

To reduce treatment costs, the government extended full customs duty exemptions on critical cancer drugs and medical device components. Additionally, the PLI scheme for pharmaceuticals was expanded from ?1,200 crore to ?2,143 crore.

Finally, allied areas such as nutrition (POSHAN 2.0), rural housing and AYUSH systems received additional support. This signalled the governments commitment to an integrated approach to healthcare and social welfare.

Indian Diagnostic Industry7

Indias diagnostic industry, currently estimated at $12-13 billion, is set for robust growth in the years ahead. It is expected to expand at a CAGR of 12-14%. This momentum is expected to be fuelled by multiple structural factors, such as increasing healthcare awareness, a higher prevalence of chronic conditions and greater focus on preventive care. The sector remains highly fragmented, with organised chains comprising only about 15-20% market share, while the balance is held by standalone laboratories and hospital-based diagnostic units. Regulatory support such as the Free Diagnostics Services Initiative and enhanced healthcare infrastructure is encouraging the formalisation of the sector. Further, innovations, such as digital diagnostics, doorstep sample collection and bundled health packages are improving customer experience and also supporting the growth of revenue.

Pathology continues to dominate the Indian diagnostics landscape, accounting for an estimated ~60% of industry revenue. Radiology, however, is poised for faster growth due to under-penetration, public-private partnership opportunities and rising investments in advanced imaging infrastructure. Although the sector experienced a brief correction post the COVID-19 surge, recovery is underway as volumes increase and companies expand into marginalised regions. Key growth catalysts include the rising demand for wellness bundles, price rationalisation in high-end tests and consolidation among organised players. Overall, Indias diagnostic sector offers significant headroom for sustained growth, supported by favourable demographics, policy support and a shift in consumer preferences towards quality and comprehensive diagnostic solutions.

Structure of the Market

The diagnostic industry in India is made up of two major segments:

1. Pathology Testing (~60% of the market)

This encompasses blood, urine, stool and tissue tests. It is the more commonly used diagnostic service, especially for regular health check-ups and for monitoring chronic conditions.

2. Radiology or Imaging (~40% of the market)

This includes services, such as X-rays, ultrasounds, CT scans, MRI and PET scans. These are utilised for detailed diagnostic insights, especially in cancer, orthopaedics and neurology.

Key Growth Drivers

Rising Incidence of Non-Communicable Diseases (NCDs)

Cancer care in India is witnessing escalated demand due to increasing incidence rates and plans to set up 200 district- level Day Care Cancer Centres. This is driving higher utilisation of tumour marker tests (CEA, CA-125), advanced imaging (mammography, MRI), biopsies and genetic diagnostics. In cardiac care, widespread hypertension affecting 1 in 4 adults fuels demand for cardiac enzyme panels, ECGs, echocardiograms, stress tests and lipid profiling. Both segments are among the fastest-growing and most profitable areas in diagnostics.

Under-Penetration and Fragmented Market

The Indian diagnostic sector remains highly under-penetrated, making up just 6% of healthcare expenditure despite driving 70% of medical decisions. With fewer tests per capita, nearly half the market is run by small labs and less than 5% NABL- certified, indicating significant opportunity for organised players to expand, consolidate and strengthen consumer trust.

Surge in wellness diagnostics

The preventive diagnostic segment is witnessing rapid expansion, with an estimated CAGR of 18-20%. Rising incomes, greater health consciousness and more employer- sponsored health programmes are driving this growth. Consumers increasingly opt for bundled packages covering cancer markers and cardiac risk profiling. Post-Covid, heightened awareness around chronic disease management has further accelerated the demand for routine screenings and preventive diagnostics.

Digitisation and Home Collection

Rapid digitisation is reshaping the industry through online booking systems, tele-radiology platforms and AI-powered reporting. Home sample collection, faster turnaround times and e-commerce channels offering discounts and bundled diagnostic packages are boosting accessibility, convenience, patient compliance and test volumes.

Expansion to Tier-2, Tier-3 and Rural India

The diagnostic volumes in India originate from non-metro regions. Organised diagnostic chains are now aggressively expanding into Tier 2, Tier 3 and rural markets, which remain fragmented and dominated by unorganised labs. This geographic diversification is expected to support sustained double-digit growth across the sector.

Private and Corporate Insurance Penetration

The rising penetration of private health insurance and corporate wellness programmes is reshaping affordability dynamics in diagnostics. Insurance-backed access is facilitating broader adoption of advanced tests, particularly in cancer and cardiac care. This trend is driving higher realisations per patient and also reinforcing industry fundamentals by expanding access to specialised, high-margin diagnostics.

Radiology Outpacing Pathology

Radiology now constitutes 42% of the diagnostic market and is set to outpace pathology in growth. This is fuelled by significant under-penetration, chronic disease prevalence and expanding PPP investments. Demand is particularly strong for high-value modalities, such as CT scans, MRI and PET-CT, especially for oncology and cardiac care.

Cancer and Cardiac Care - Structural Tailwinds

Cancer care in India is witnessing escalated demand due to increasing incidence rates and plans to set up 200 district- level Day Care Cancer Centres. This is driving higher utilisation of tumour marker tests (CEA, CA-125), advanced imaging (mammography, MRI), biopsies and genetic diagnostics. In cardiac care, widespread hypertension affecting 1 in 4 adults fuels demand for cardiac enzyme panels, ECGs, echocardiograms, stress tests and lipid profiling. Both segments are among the fastest-growing and most profitable areas in diagnostics.

Outlook

The diagnostic sector in India is expected to grow at 12- 14% CAGR, supported by rising health awareness, expanding preventive care and a clear migration towards organised providers. Penetration remains low, particularly in areas outside metro areas. Government-led initiatives and capital investments in imaging and pathology infrastructure are driving deeper access. Radiology, in particular, is expected to grow faster than pathology due to unmet demand and strong PPP initiatives targeting advanced imaging capabilities across districts.

Organised players are well-positioned to benefit from these trends, leveraging their scale, brand strength and ability to offer comprehensive test menus, including high-end specialty and bundled wellness packages. Companies are investing aggressively in expanding collection centres and digital platforms to improve patient access, while market continues to gather pace. Though rising competition from online aggregators and new entrants remains a challenge, the sectors high return on invested capital, minimal regulatory risks and strong sectoral tailwinds underpin positive earnings visibility for FY 2025 and beyond. Overall, the outlook remains constructive, with diagnostics emerging as a high-growth, high-margin segment within Indian healthcare landscape.

Company Overview

Krsnaa Diagnostics Ltd. (KDL) has established itself as one of Indias most agile and rapidly scaling diagnostic service providers. The Companys core offerings range across radiology, pathology and tele-radiology. Guided by a vision to redefine the Indian healthcare landscape, the Company remains resolute on delivering affordable, high-quality and innovative diagnostic solutions across the country.

The Company leverages cutting-edge technology to drive operational excellence and accessibility. Notably, KDL operates Indias first NABH-accredited tele-radiology reporting hub in Pune, providing 24/7 services. The hub process high volumes of X-rays, CT scans and MRI scans. This facility plays a vital role in extending diagnostic services to underserved regions while ensuring accurate and prompt reporting.

In a significant milestone, KDL earned accreditation from the College of American Pathologists (CAP), becoming the only PPP-model laboratory in India to achieve this distinction. This accomplishment conveys the Companys dedication to upholding rigorous standards and continuous improvements in service delivery.

Krsnaa Diagnostics combines unrivalled clinical expertise, a robust IT-enabled infrastructure and a disruptive pricing strategy to deliver high-quality diagnostics at significantly lower costs. Backed by a strong financial foundation and a proven track record of organic growth, the Company is actively exploring inorganic expansion opportunities to strengthen its leadership in the diagnostic services space.

Business Segments

The Company stands as a prominent diagnostic player with a national footprint across radiology, pathology and tele- radiology. The Companys Public-Private Partnership (PPP) business continues to serve as a strong platform of growth, enabling sustainable revenue generation through contracts across 18 states.

The Company has strategically entered the retail diagnostics segment, leveraging its strong presence in regions where it operates under Public-Private Partnership (PPP) contracts. Retail operations have been launched across key states, including Maharashtra, Punjab, Odisha and Assam. This strategic expansion aims to capitalise on existing brand equity, improve asset utilisation and drive sustainable growth and margin enhancement.

Operating under the RPL brand, the retail diagnostics division has witnessed robust growth. The segment nearly quadrupled its number of touchpoints by effectively utilising the PPP network to serve both B2C and B2B customers with integrated and affordable diagnostic solutions. Supporting this growth, the Companys digital initiatives—such as app-based booking, home sample collections and real-time reporting—have enabled it to meet the rising demand for preventive and wellness diagnostics.

Radiology

The Company offers a comprehensive suite of radiology services encompassing multiple imaging techniques such as MRI, CT scans, X-rays, mammography, bone densitometry, ultrasound and Colour Doppler. These services are supported by an advanced

research facility and a strong IT backbone, which ensures accurate diagnostics and prompt delivery of reports to healthcare practitioners. During the year, the Company continued to prioritise aware-building, adherence to accreditation protocols and the expansion of radiology infrastructure. These efforts helped the Company lay the groundwork for long-term expansion and service excellence.

The radiology segment remained a key growth driver for Krsnaa Diagnostics, supported by strong expansion under PPP contracts and heightened demand for advanced imaging services. The Company successfully commissioned a significant number of CT and MRI centres, including 40 CT scan machines in Maharashtra and new MRI installations in Maharashtra and Madhya Pradesh, with several additional sites centres nearing completion. In partnership with United Imaging, the Company introduced state-of-the-art MRI, CT and PET-CT technologies, enhancing diagnostic sophistication and service quality. Radiology volumes grew steadily across Tier 2 and Tier 3 cities. The Companys NABH accredited tele-radiology hub in Pune continued to streamline reporting workflows, reduce diagnostic turnaround times and scale remote operations efficiently. Overall, radiology operations demonstrated robust performance and contributed meaningfully to revenue growth and margin expansion.

Pathology

The Company provides a broad spectrum of diagnostic services spanning all major domains of laboratory testing, including biochemistry, haematology, clinical pathology, histopathology, cytopathology, microbiology, serology and immunology. Services are delivered through a hub-and-spoke network across different centres nationwide, establishing a comprehensive solution for all pathology- related diagnostic needs. The Companys dedicated research team continuously develops new tests to address emerging healthcare needs. Notably, the Company remains the only PPP-model laboratory in India accredited by the College of American Pathologists (CAP).

Growth in the pathology segment was propelled by heightened consumer focus on preventive healthcare and convenience-led services, such as home sample collection, especially in Tier 2 and Tier 3 cities. The Company expanded its footprint by launching new laboratories and over 600 collection centres in Odisha and Assam. This network upgrade improved diagnostic accessibility in previously underpenetrated geographies.

By leveraging its extensive PPP infrastructure and the RPL retail platform, the Company successfully scaled its pathology operations across both institutional (B2B) and direct consumer (B2C) markets. This dual-channel strategy led to strong volume growth and elevated brand visibility. Strategic investments in technology-enabled processes, such as integrated digital platforms for booking, logistics and report delivery, further enhanced operational efficiency and customer satisfaction. The Companys focus on affordability, quality accreditation and a diverse test portfolio has reinforced its leadership in the pathology sector while maintaining sustainable profitability.

Tele-radiology

The Company significantly expanded its retail footprint by leveraging its established infrastructure and Public-Private Partnership (PPP) ecosystem to diversify into high-potential geographies, such as Maharashtra, Punjab, Assam and Odisha. The Company operates Indias first NABH-accredited teleradiology hub, which supports both PPP and retail networks by providing round the clock remote reporting services. This centralised model has enabled timely interpretation of imaging studies across a large and growing network of CT and MRI centres, particularly in Tier 2 and Tier 3 regions, where access to qualified radiologists remains limited. The integration of AI-enabled reporting tools and secure connectivity has improved turnaround times, accuracy and overall operational efficiency. These efforts have played a critical role in strengthening the Companys commitment to quality and affordability. The teleradiology segment remains a strategic growth pillar for the Company. The segment enables the Company to expand the access to high-quality radiology services nationwide while driving productivity and cost optimisation.

Retail Presence

The Company is significantly expanding its retail diagnostics footprint under the dedicated RPL brand, leveraging its extensive B2G infrastructure and strong PPP network to drive rapid growth across key geographies. This expansion resulted in a nearly fourfold increase in touchpoints within a single year, strengthening access to integrated radiology and pathology services for both B2C and B2B customers in metro and emerging markets.

The asset-light model has emerged as a foundational lever for scalable growth and disciplined capital allocation. By focusing on establishing exclusive collection centres and forging strategic partnerships with hospitals, nursing homes and B2B collaborators,

the Company has effectively positioned its retail business to capitalise on the rising demand of preventive health check-ups and specialised diagnostic solutions in underserved markets.

The retail business offers an extensive catalogue of over 3,200 diagnostic tests, spanning core and specialised areas including gynaecology, orthopaedics and oncology. Complemented by home collection services, wellness packages and digital platforms for test booking and report delivery, this integrated service suite has improved customer convenience and reinforced the RPL brands reputation as a reliable healthcare service provider.

Targeted consumer engagement initiatives encompassing in- shop branding and preventive wellness programmes further strengthened brand visibility and recall. These efforts have enabled the Company to build a distinguished retail diagnostics business that provides affordable, high-quality healthcare delivery across urban and semi-urban geographies.

Benefits of Retail Presence

y Diversification of Revenue Streams:

The retail diagnostics business extends beyond the PPP model, enabling the B2G government contracts. y Enhanced Accessibility and Brand Reach

The Company growing retail network, including home collection services and digital platforms, strengthens brand visibility and makes high-quality diagnostic services accessible across metro, Tier 1, Tier 2 and Tier 3 cities. It is further through strategic in-shop branding, health camps and preventive care initiatives, encouraging greater community engagement and trust.

y Improved Margins and Capital Efficiency:

An asset-light retail model (COCO, FOCO, FOFO) supports faster scalability with lower capital expenditure while improving realisations compared to PPP pricing structures.

y Integration of Wellness and Preventive Offerings:

Retail expansion allows the Company to cater to rising demand for preventive health checks, specialised tests and wellness packages, further strengthening customer engagement and loyalty.

Growth strategy

Expand Public-Private Partnerships (PPP)

The Company seeks to deepen its leadership position in the PPP segment by proactively targeting new tenders in underpenetrated markets. Leveraging its proven expertise, the focus will be on expanding the installed base of radiology and pathology centres across strategically identified geographies. In

FY 2025, the Company achieved a 75% bid success rate, securing major contracts across Jharkhand, Assam, Maharashtra, Madhya Pradesh and Odisha. These wins facilitated the commissioning of 45 radiology centres, a new pathology lab and upwards of 700 collection centres. In addition, alignment with government health initiatives continues to drive demand for affordable diagnostics.

As part of its strategic expansion, the Company has been awarded the Rajasthan State Pathology Project, to be executed under a hub-and-spoke model. The project will span all 42 districts of Rajasthan, comprising 42 Mother Labs, 135 Hub Labs and 1,335 Collection Centers. This extensive network is aimed at enhancing the accessibility, affordability and quality of diagnostic services across both urban and rural regions. With full-scale implementation targeted by FY 2027, the project underscores the Companys leadership in public-private partnerships and further consolidates its position as a key partner in state-led healthcare initiatives of national significance

Strategic Tie-Ups

The Company has reinforced its market leadership through significant strategic partnerships and investments:

y Entered a collaboration with a leading OEM to deploy advanced diagnostic equipment under a deferred payment model, ensuring capital efficiency and accelerating radiology network expansion.

y Established a strategic investment in Apulki Healthcare, securing a 30-year exclusive diagnostic partnership with oncology and cardiac hospitals, with an option to extend, providing long-term revenue visibility.

Scaling Retail Diagnostics and B2C Presence

Building on the strong foundation of its PPP infrastructure, the Company is rapidly expanding its retail presence through an asset-light strategy designed for scale and profitability. The Company has an ambitious plan to establish 700 exclusive centres over the medium term. In FY2025, retail operations were successfully launched across four states and within a short span, the Companys network expanded from 1,600+ to over 2,400 touchpoints. The Company remains firmly on track to achieve its target of 10,000 touchpoints by FY2027.

On the non-exclusive front, the Company is executing a clear strategy to drive a structural shift towards consumer-led growth. Its long-term vision is to achieve a 70:30 B2C to B2B revenue mix, with the B2C share expected to accelerate meaningfully in FY2026 over FY2025. The B2C business is already demonstrating powerful momentum, with revenues having grown substantially over last year. This sharp and sustained traction underscores the scalability of the Companys model and reinforces its confidence in driving a significantly higher B2C contribution going forward.

Strengthen Integrated Diagnostic Offerings

The Company will widen its suite of integrated services spanning radiology, pathology and teleradiology. Targeted efforts will be undertaken to expand the test portfolio to encompass genomics and advanced diagnostics, catering to both institutional and retail segments. This approach further cements the Companys position as a comprehensive diagnostic solutions provider.

Drive Cost Leadership and Profitability

A disciplined focus on cost management and operational efficiencies will be maintained to ensure the affordability of services. The Company is committed to sustaining healthy EBITDA margins while offering competitive pricing across its offerings.

Technology Enablement and Digital Transformation

Investments in technology are central to its operational strategy. The Company is deploying AI-enabled diagnostics, tele-radiology platforms and digitised payment systems to streamline workflows, improve receivable collections and ensure prompt reporting.

Geographic Expansion in Underpenetrated Markets

The Company continues to expand into Tier 2 and Tier 3 cities to bridge Indias diagnostic accessibility gap, demonstrating strong volume growth and the effectiveness of its network optimisation strategy. This ongoing geographic expansion is expected to remain a key driver of growth in the years ahead.

Performance review

The Company recorded strong financial and operational results, reinforcing its status as one of Indias leading differentiated diagnostic service providers. The Company achieved a 16% year- on-year increase in revenue, led by higher footfalls across its radiology, pathology and tele-radiology segments. EBITDA grew by 34%, reflecting enhanced operational efficiency and disciplined cost management, while profit after tax surged 37% over the prior fiscal. Notably, patient volumes and test counts climbed significantly, backed by a widespread network of over 3,500 collection centres, 180 CT/MRI centres and 117 pathology labs across different states and union territories. Accreditations also saw growth, with 51 NABL-certified labs and 31 NABH-accredited centres now in place. Overall, this robust performance embodies the Companys resolute focus on quality and compliance.

The Company has also expedited its retail expansion, achieving a fourfold increase in retail touchpoints across Maharashtra, Punjab, Assam and Odisha. This growth was complemented by targeted initiatives, such as preventive health checkup camps, awareness programmes and alliances with hospitals. These initiatives strengthened the Companys reach in underserved markets.

Outlook

The Company has built a strong foundation and a clear roadmap for long-term growth across key verticals and emerging business segments. In FY 2025, the Company delivered double-digit gains in both revenue and profit. This performance was facilitated by operational consistency and a balanced portfolio. Expansion into underserved areas continues through new centres, laboratories and collection points, supported by a robust Public-Private Partnership (PPP) model. This is helping the Company to widen its footprint and strengthen its identity as a differentiated service provider. The Companys commitment to delivering high-quality diagnostics at highly competitive pricing enhances affordability and strengthens its resilience against industry pricing pressures.

The Companys high bid-to-win ratio of 75% in Public-Private Partnership (PPP) tenders highlights its leadership in this segment and establishes a robust pipeline for future growth. A significant ramp up is expected in FY 2026, driven by several large projects, including the Maharashtra CT/MRI contracts and expansions in Jharkhand, Assam, Odisha and Madhya Pradesh.

The Company is focused to expanding its reach across Tier- 2 and Tier-3 cities, scaling its retail diagnostics footprint and strengthening digital health and tele-radiology capabilities. The favourable industry tailwinds, such as rising demand for preventive diagnostics, growing healthcare expenditure, government-led free diagnostics initiatives and heightened awareness offer significant opportunities for the Company to expand access to affordable, high-quality diagnostic services. Supported by a strong balance sheet, trusted brand equity and a seasoned leadership team, the Company is well equipped to sustain growth, enhance shareholder value and play an instrumental role in transforming Indias diagnostic landscape in the years ahead.

Opportunity and Challenges

Opportunities	Details
Expansion in Semi-Urban and	The Company is well-positioned to capitalise on the diagnostic market in semi-urban and
Rural Markets	rural India, leveraging its extensive PPP (Public-Private Partnership) model and projects under implementation.
Rapid Growth in Preventive and	Preventive healthcare diagnostics are witnessing a notable upswing with wellness packages
Wellness Diagnostics	gaining traction, especially among the Tier-2 and Tier-3 cities.
Retail Diagnostics Expansion	The ramp-up of an asset-light retail network across Maharashtra, Punjab, Assam and Odisha, with a 4x increase in touchpoints over the year, is paving the way for diversified revenue streams.
Integrated Diagnostic Offerings	The capability to provide radiology, pathology and tele-radiology under a unified platform enables differentiated services and cross-selling opportunities.
Cost Leadership and	Established cost-efficient model allows pricing to be below market rates, while maintaining healthy
Competitive Pricing	EBITDA margins and profitability.

 

Challenges	Details
Technological Upgradation Costs	Sustained investment in advanced diagnostic technology is necessary to stay competitive. Although capital-intensive upgrades can strain short-term profitability
Intensifying Competitive Landscape	Heightened competition from organised and regional players could exert pressure on margins and tender success rates.
Regulatory and Compliance Risks	Evolving regulations, accreditation norms and potential pricing caps may escalate compliance costs and complexity.
Talent Acquisition and Retention	Scaling integrated diagnostics and digital services requires continuous investments in recruiting and retaining skilled professionals across functions.

Financial Highlights (Consolidated Basis)

Particulars	FY 24-25	FY 23-24
Revenue	7,172	6,196
EBITDA	1,958	1,466
EBITDA Margin	27%	24%
PAT	776	568
PAT Margin	11%	9%
EPS	23.6	17.3

Financial Ratio (Consolidated Basis)

Particulars	FY 24-25	FY 23-24	% Change	Reasons Details of significant changes (i.e. change of 25% or more as compared to the immediately previous Financial Year) in key financial ratios
Debtors Turnover (in times)	3.10	4.90	-36.00%	Stretched receivables in FY2024-25 has resulted in decrease of this ratio compared to last year.
Inventory Turnover (in times)	5.20	4.60	12.00%	-
Interest Coverage Ratio (in times)	5.20	5.20	-2.00%	-
Current Ratio (in times)	1.40	1.50	-9.00%	-
Debt Equity Ratio (in times)	0.10	0.10	-7.00%	-
Operating Profit Margin (%)	17.80%	14.00%	27.00%	Increase in revenue on account of scale-up of earlier implemented projects along with cost control measures by the Company has resulted in increase in profitability compared to last year. Hence, operating profit marging has increased.
Net Profit Margin (%)	10.80%	9.20%	18.00%	-
Return on Net Worth (%)	8.80%	7.00%	25.30%	Increase in revenue on account of scale-up of earlier implemented projects along with cost control measures by the Company has resulted in increase in profitability compared to last year. Hence, return on net worth has increased.

Risk Management

Risk	Description	Mitigation
Competition	Intensified competition between established diagnostic chains and standalone players can potentially lead to price fluctuations, customer attrition and loss of market share.	The PPP segment, where competition remains sparse, is central to the Companys strategy. Its trusted brand, efficient pricing and scalable business model continue to provide a competitive edge to the Company.
Government Contract Risk	The cyclical nature of payments from government contracts could impact cash flows and working capital management. Dependency on government policies and budgetary allocations for healthcare also poses potential threats.	The Company generates revenue across different regions and verticals, reducing concentration risk. The Company provides services in 18 States/UT and is not dependent on a single state/ government for its business. The PPP model provides long-term contract visibility. The Company maintains strong cash flows, efficient working capital management and is venturing into retail to further diversify its revenue base.
Capital Expenditure	High capital expenditure requirements for radiology equipment, such as CT and MRI machines, could strain financial resources during expansion phases.	The Company has strategic tie up with OEMs, which allows it to fund its capex with minimum cash outflow. The Company leverages its scalable teleradiology hub and centralised operations to optimise resource utilisation. It maintains a solid financial foundation, which generates sustained revenue to support growth initiatives.
Regulatory Risk	Regulatory shifts or compliance requirements could impact operations or escalate operational costs.	The Company adheres to stringent quality control measures, holds accreditations like NABH and NABL and operates under the seasoned guidance of its leadership team and Board of Directors, who maintain strict oversight on compliance.
Technological Risk	Technological disruptions or advancements could render existing infrastructure or business operations obsolete, requiring additional investments.	The Company invests in robust infrastructure and centralised operations, ensuring efficient implementation of emerging technologies across its network.
Cybersecurity Risk	Risk of breach in storage and handling of sensitive patient data and medical records.	The Company implements advanced cybersecurity measures, including data encryption, access controls and regular security audits to protect patient data and maintain privacy.
Supply Chain Risk	Supply chain disruptions or shortages of critical medical equipment or consumables could impact operations and service delivery.	The Company maintains strategic partnerships with leading equipment manufacturers and suppliers and has diversified its supplier base to ensure reliability and mitigate supply chain risks.

Internal Control System and their Adequacy

The Company has implemented a comprehensive internal control framework that is customised to suit its scale, complexity and operational needs. These controls are structured to protect assets, promote operational effectiveness and ensure adherence to all relevant laws and regulations. The framework integrates both financial and operational controls to uphold the accuracy of financial reporting and prevent unauthorised access or asset loss.

To monitor the adequacy of these controls, the Company carries out regular audits covering various business units and critical processes. These evaluations, conducted by the internal audit team, are presented to the Audit Committee, which reviews the outcomes and initiates necessary corrective actions to resolve any identified deficiencies. Recommendations are promptly implemented to further strengthen the control environment. The Company remains dedicated to the continual enhancement of its internal control systems to better manage risks, streamline operations and align with leading industry practices.

Cautionary statement

The Management Discussion and Analysis (MDA) section may contain forward-looking statements regarding potential future developments. These statements involve known and unknown risks and uncertainties that could materially affect final results. In addition to macro-environmental changes, a worldwide pandemic could introduce unforeseen, unprecedented and continuously evolving risks to the Company and its operating environment. The facts and figures in the report are derived from assumptions based on available internal and external data, making them susceptible to change as underlying variables are dynamic. Any forward-looking statement made in this context reflects the Companys current intentions, beliefs or assumptions as of the date it was made. The Company does not undertake to update or revise any forward-looking statements, whether due to new data, unexpected developments or other factors.

Board Committees

Audit Committee

Mr. Chetan Desai Ms. Chhaya Palrecha Mr. Adesh Kumar Gupta Mr. Rajiva Ranjan Verma Mr. Yash Mutha Mr. Prem Pradeep

Nomination & Remuneration Committee

Mr. Adesh Kumar Gupta Ms. Chhaya Palrecha Mr. Chetan Desai Mr. Prem Pradeep

Corporate Social Responsibility Committee

Mr. Rajendra Mutha Ms. Pallavi Bhatevara Mr. Rajiva Ranjan Verma Mr. Prem Pradeep

Risk Management Committee

Mr. Rajiva Ranjan Verma Mr. Adesh Kumar Gupta Mr. Yash Mutha Mr. Mitesh Dave

Stakeholders Relationship Committee

Mr. Adesh Kumar Gupta Ms. Chhaya Palrecha Mr. Yash Mutha

Operation Committee

Mr. Rajendra Mutha Mr. Yash Mutha Ms. Pallavi Bhatevara

Group Chief Executive Officer

Mr. Mitesh Dave

(Appointed w.e.f. June 01, 2024)

Chief Executive Officer

Dr. Prashant Deshmukh

(Resigned w.e.f. July 31, 2024)

Chief Financial Officer

Mr. Pawan Daga

Company Secretary

Mr. Sujoy Bose

Auditors

Statutory Auditors

MSKA & Associates,

Chartered Accountants

Internal Auditors

Mahajan & Aibara,

Chartered Accountants LLP

Secretarial Auditor

Dinesh Birla & Associates,

Company Secretaries

Cost Auditors

Harshad S. Deshpande & Associates,

Cost and Management Accountants

Bankers

IndusInd Bank Limited HDFC Bank Limited YES Bank Limited

Registered Office & Corporate Office

S. No. 243/A, Hissa No. 6, CTS No. 4519, 4519/1, Near Chinchwad Station, Chinchwad, Taluka- Haveli, Pune -411019

Website: www.krsnaadiagnostics.com

Registrar and Transfer Agent

KFin Technologies Limited

Selenium, Tower B, Plot No. 31 & 32, Financial District, Nanakramguda, Serilingampally, Hyderabad Rangareddi, Telangana- 500032 Email: einward.ris@kfintech.com Website: www.kfintech.com

Corporate Identification Number

L74900PN2010PLC138068