Metropolis Healthcare Ltd Management Discussions

GLOBAL ECONOMY

Global economic growth remained stable but moderate, with global GDP projected at 3.4% in 2025, moderating to 3.1% in 2026 before recovering slightly to 3.2% in 2027, reflecting a steady but subdued expansion. The global outlook continues to be shaped by persistent geopolitical tensions, evolving trade dynamics, and uneven regional growth patterns.

Ongoing conflicts, including the Russia–Ukraine war and instability in the Middle East, remain key sources of uncertainty. These developments are exerting pressure on energy markets, disrupting supply chains, and contributing to volatility in global financial conditions. Trade fragmentation and geopolitical disruptions have also affected critical commodity flows and key shipping routes, resulting in pricing pressures and tighter financial conditions, particularly across Asia.

Inflationary pressures are gradually easing, with global inflation projected to decline from approximately 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027, although the pace of moderation remains uneven across regions. Energy price volatility and geopolitical developments continue to pose upside risks to inflation, requiring central banks to maintain a cautious and balanced policy stance.

Growth trends vary across regions. Advanced economies are expected to grow modestly at 1.7%–1.9%, with the United States demonstrating relative resilience, while the Euro Area and Japan continue to face subdued economic momentum. In contrast, Emerging Markets and Developing Economies are projected to grow at just above 4%, supported by domestic consumption and infrastructure investment, although elevated debt levels and tighter financial conditions remain key risks.

Regionally, the Middle East continues to demonstrate resilience, supported by strong domestic demand, while Southeast Asia remains an important growth driver, albeit with moderating momentum in certain economies following strong performance in the previous year.

Region-Wise Output (% Y/Y)

Region	CY 2025 (E)	CY 2026 (P)	CY 2027 (P)
World	3.4	3.1	3.2
Advanced Economies	1.9	1.8	1.7
Emerging Markets and Developing Economies	4.4	3.9	4.2

Source: World Economic Outlook, April 2026, IMF (E – Estimated; P – Projected) h t t p s : / / w w w . i m f. o r g / e n / p u b l i c a t i o n s / w e o / issues/2026/04/14/world-economic-outlook-april-2026

Overall, the global economy is expected to maintain moderate and stable growth, supported by resilient domestic demand in emerging markets and gradual easing of inflation. However, elevated geopolitical risks, trade policy uncertainty, and tighter financial conditions are expected to continue influencing the near-term outlook.

Sources:

• https://www.oecd.org/en/publications/oecd-economic-outlook-interim-report-march-2026_ d4623013-en.html

• https://www.imf.org/en/publications/weo/ issues/2026/04/14/world-economic-outlook-april-2026

INDIAN ECONOMY

Indias macroeconomic environment in FY 2025-26 remained resilient, supported by strong domestic demand, sustained public investment, and stable macroeconomic fundamentals. Real GDP growth is estimated at approximately 7.4% in FY 2025-26 , reflecting continued momentum across key sectors, including services, manufacturing, and construction. Favourable monsoon conditions supported agricultural output and rural demand, contributing to overall economic stability.

Inflationary pressures moderated during the year, supported by easing food prices and effective policy measures.

Consumption trends remained mixed. While urban consumption showed some moderation due to elevated food prices and housing costs, underlying demand remained stable, supported by income growth and improving rural consumption. Private consumption continued to be a key growth driver, reflecting resilience in domestic demand.

Policy support remained strong, with continued focus on infrastructure development, manufacturing, and formalisation of the economy. Government initiatives aimed at improving ease of doing business, enhancing digital infrastructure, and expanding financial inclusion are supporting long-term economic growth.

Year	GDP Growth (%)
FY 2021–22	8.7
FY 2022–23	7.6
FY 2023–24	9.2
FY 2024–25	6.5
FY 2025–26 (P)	7.4

Source: h t t p s : / / w w w . m o s p i . g o v . i n / u p l o a d s / latestreleasesfiles/1767782498513 GDP%20Press%20 Note%20on%20FAE%202025-26.pdf

Source: *MOSPI NSO Report dated January 7, 2025 ^#RBI MPC report dated April 9, 2025

Indias macroeconomic fundamentals remain strong, supported by robust domestic demand, ongoing structural reforms, and continued policy support.

The secondary and tertiary sectors recorded strong growth during FY 2025-26 , each expanding by over 9%. Key service segments such as trade, hotels, transport, and communication grew by approximately 10.1%, while manufacturing delivered double-digit growth, emerging as a key driver alongside services.

The Reserve Bank of India maintained a balanced monetary stance, holding the repo rate at 5.25% in February 2026 to support growth while managing inflation. Inflation remained benign during the year, supported by strong agricultural output. Fiscal consolidation continues to be a focus area, with government capital expenditure remaining a key priority to drive long-term growth.

India continues to strengthen its position as a preferred manufacturing destination globally, supported by initiatives such as Make in India and the Production Linked Incentive (PLI) schemes. Goods exports are targeted to reach USD 1 trillion by 2030, supported by increasing global integration and policy support. While currency movements impacted Indias relative global ranking in the short term, the country remains on track to become one of the largest economies globally over the medium term.

The Union Budget 2026-27, aligned with the "Viksit Bharat" vision, focusses on enhancing MSME credit access, strengthening healthcare infrastructure, promoting clean energy, and advancing AI-driven innovation. Initiatives such as the "Yuva Shakti" framework aim to support skill development, employment generation, and entrepreneurship.

Looking ahead, Indias real GDP growth is projected at approximately 6.4% for FY 2026-27, with upside potential as credit growth strengthens, investment activity accelerates, and structural reforms continue to deepen. Overall, the Indian economy remains well-positioned for sustained medium-term growth, supported by strong fundamentals and a stable macroeconomic environment.

Sources:

• h t t p s : / / s t a t i c . p i b. g ov. i n / W r i te Re a d D a t a / s p e c i f i c d o c s / d o c u m e n t s / 2 0 2 6 / j a n / doc2026130774501.pdf?

• https://www.pib.gov.in/PressReleasePage.aspx?PRI

D=2233518&reg=3&lang=1#::text=Real%20GDP%20 or%20GDP%20at%20Constant%20Prices%20in%20 Q3%20of,a%20growth%20rate%20of%208.2%25.

• https://www.moneycontrol.com/news/business/ economy/india-slips-to-sixth-largest-economy-in-2025-now-seen-becoming-third-biggest-by-2031-13889924.html

INDIAN HEALTHCARE INDUSTRY

Indias healthcare sector continued to demonstrate resilient growth in FY 2025-26, supported by rising demand for specialised healthcare services, steady capacity expansion by hospital chains, and increasing formalisation across segments, including diagnostics. The sector has expanded significantly in both scale and scope over the past decade, driven by rising public and private investments, wider insurance coverage, and improving service delivery standards.

India continues to benefit from a large pool of highly qualified medical professionals and a strong cost advantage, positioning it as a competitive healthcare destination globally. However, structural challenges persist, particularly in the form of infrastructure imbalances across regions. A significant proportion of healthcare infrastructure remains concentrated in urban areas, with approximately 65–70% of hospital beds located in cities, while nearly 65% of the population resides in rural regions. This disparity underscores a substantial opportunity for both public and private sector investments aimed at expanding healthcare access in underserved markets.

The sector continues to attract investor interest, with private equity investments in Indian healthcare remaining robust, reflecting long-term confidence in the sectors growth potential. At the same time, policy support remains a key driver of expansion. The Union Budget FY 2026-27 introduced several measures aimed at strengthening the healthcare ecosystem, including an allocation of approximately Rs.10,000 crore towards the Biopharma SHAKTI initiative, focussed on advancing research, innovation, and domestic capabilities in pharmaceuticals and life sciences.

Further, the estimated healthcare expenditure for FY 2026-27 is projected at approximately Rs.1,04,599 crore, reflecting continued government commitment to strengthening healthcare infrastructure and delivery systems. Policy initiatives continue to focus on expanding healthcare access, improving quality, and building capacity across the value chain.

The government is also undertaking targeted initiatives to diversify and strengthen the healthcare ecosystem. These include promoting AYUSH systems of medicine, expanding medical tourism, strengthening mental healthcare infrastructure, and enhancing the availability of skilled healthcare professionals. Plans to upgrade existing Allied Health Professional (AHP) institutions and establish new ones across multiple disciplines are expected to add over 100,000 trained professionals over the next five years, addressing critical workforce gaps.

Medical tourism continues to emerge as a key growth area, supported by cost competitiveness, quality of care, and increasing global demand. The development of integrated regional medical hubs is expected to further enhance Indias positioning as a global healthcare destination by combining healthcare delivery, education, and research capabilities.

In addition, the government has announced measures to improve affordability and accessibility of healthcare, including the proposed exemption of basic customs duty on select drugs and medicines. Expansion of mental healthcare infrastructure, including new institutions and upgrades to existing facilities, reflects a broader focus on holistic healthcare delivery.

While the sector continues to face challenges such as infrastructure gaps, workforce shortages, and regional disparities, the overall outlook remains positive. The Indian healthcare industry is expected to continue its growth trajectory, supported by favourable demographics, increasing investments, policy support, and ongoing technological advancements, creating significant opportunities across the healthcare value chain, including diagnostics.

Sources:

• https://www.ey.com/content/dam/ey-unified-site/ ey-com/en-in/services/tax/union-budget-2026/ey-pharma-and-life-science-sector-highlights.pdf • https://www.ibef.org/industry/healthcare-india

DIAGNOSTICS INDUSTRY

The Indian diagnostics industry continues to be one of the fastest-growing segments within the broader healthcare ecosystem, supported by increasing health awareness, rising disease burden, and improving access to diagnostic services. The market was estimated at approximately USD 10.9–11.0 billion in 2025, reflecting steady expansion driven by rising patient volumes and increasing test penetration.

The industry remains highly fragmented, with over 1.3 lakh laboratories across the country, dominated by standalone laboratories and hospital-based diagnostic centres. Standalone laboratories account for approximately 40–42% of the market, supported by their extensive geographic reach and accessibility. However, the industry is witnessing a gradual shift towards organised diagnostic chains, driven by increasing consumer preference for quality, accuracy, and reliability, as well as the need for scalable and technology-enabled operations.

This transition towards organised players has accelerated in recent years, with the share of organised chains increasing from approximately 15% in FY20 to over 22% in FY24, supported by consolidation, network expansion, and technology adoption. The trend is further reinforced by increasing merger and acquisition activity and the growing presence of national and regional chains.

From a service mix perspective, pathology continues to dominate the diagnostics landscape, accounting for approximately 65% of the total market, driven by its routine use in disease diagnosis, preventive health check-ups, and chronic disease management. Radiology constitutes the remaining 35%, including imaging modalities such as X-ray, ultrasound, CT scan, MRI, PET-CT, and nuclear imaging. The industry continues to be largely physician-led, with approximately 45–50% of diagnostic volumes originating from clinician referrals, reflecting the central role of diagnostics in clinical decision-making. At the same time, direct-to-consumer engagement is increasing, supported by rising health awareness, digital platforms, and the growing adoption of preventive healthcare.

Geographically, the diagnostics market remains concentrated in urban centres, which account for approximately 70–75% of total revenues, supported by better healthcare infrastructure, higher awareness, and stronger purchasing power. However, this concentration also highlights a significant opportunity for expansion in Tier II, Tier III, and rural markets. While nearly 70% of Indias population resides in rural areas, it contributes only ~24% of the diagnostics market, indicating substantial headroom for future growth.

Regionally, North India continues to lead the diagnostics market with a share of approximately 28–32%, followed by South and West India, while East India remains relatively underpenetrated but is expected to witness faster growth driven by improving infrastructure and increasing healthcare access.

The industry has transitioned into a more stable, volume-driven growth phase post the COVID-19 period. Revenue growth is now supported by steady increases in patient volumes, expansion into Tier II and Tier III cities, and improving realisations. A key structural trend shaping the industry is the rapid growth of preventive and wellness testing, with its share increasing from approximately 8% in FY18 to ~11% in FY24, and expected to reach ~15% by FY28, reflecting a shift towards proactive health management.

The competitive landscape continues to evolve with the presence of standalone labs, organised chains, hospital-based labs, and new-age entrants including online aggregators and e-pharmacy platforms. While earlier phases saw aggressive price competition, the industry is now witnessing improved pricing discipline and a gradual shift towards profitability and sustainable growth. Overall, the Indian diagnostics industry is transitioning from a fragmented, price-driven market to a more organised, quality-focussed, and technology-enabled ecosystem, creating significant long-term opportunities for scalable diagnostic service providers.

Source: Compiled by CareEdge Ratings. The data represent the aggregate operational data of seven sample companies in the Indian diagnostic industry, namely Dr Lal Pathlabs, Thyrocare Technologies, Suraksha Diagnostics, Vijaya Diagnostics, Krsnaa Diagnostics, Agilus Diagnostics and Metropolis Healthcare.

The organised Indian diagnostics market is among the fastest-growing segments in Indian pharma and healthcare.

INDUSTRY OUTLOOK

The outlook for the Indian diagnostics industry remains strong, supported by favourable demographics, increasing health awareness, rising adoption of preventive healthcare, expanding healthcare infrastructure and continued formalisation of the sector. These structural trends, together with improving healthcare accessibility and increasing investments across the healthcare ecosystem, are expected to sustain long-term demand for diagnostic services.

The industry is projected to grow at a CAGR of approximately 11–12% over the medium term, with the market expected to reach USD 15–16 billion over the next five years and further expand to approximately USD 28–29 billion by 2034. Growth will continue to be driven by the rising prevalence of non-communicable diseases, including diabetes, cardiovascular disorders and cancer, increasing health insurance penetration, and growing consumer preference for preventive healthcare and early disease detection.

The Indian diagnostics market is also witnessing a gradual shift towards organised diagnostic providers. Expansion into Tier II, Tier III and rural markets, supported by improving healthcare infrastructure, increasing affordability and greater accessibility, is expected to create significant growth opportunities. Organised players are well positioned to benefit from these trends by leveraging trusted brands, quality standards, scalable operating models and wider geographic reach.

Technology will continue to serve as a key enabler of industry transformation, enhancing diagnostic accuracy, operational efficiency and patient experience. Continued adoption of automation, digital platforms and advanced diagnostic technologies is expected to improve accessibility, reduce turnaround times and support scalable growth across the diagnostics value chain.

While pricing pressures in routine diagnostics, evolving regulatory requirements and competitive intensity may continue to influence the operating environment, the industrys long-term fundamentals remain robust. The continued shift towards organised, quality-driven and technology-enabled diagnostics providers is expected to support sustainable growth and long-term value creation.

India Diagnostic Labs Market Forecast

Size, By Provider Type, 2025-2034 (USD Billion)

Source: https://www.imarcgroup.com/india-diagnostic-labs-market

Sources:

• https://research.axiscapital.co.in/researchPortal/Report/GetEmailReport/?code=dbf70942-f236-4a9d-bdb1-aaf44fcd762d

• https://www.ey.com/content/dam/ey-unified-site/ey-com/en-in/newsroom/2026/01/ey-healthcare-news-letter-q2-fy-26-update-december-2025.pdf

• https://www.ibef.org/industry/healthcare-india

• https://www.crisilratings.com/en/home/newsroom/press-releases/2026/02/healthy-occupancy-rising-realisations-to-drive-14-15-percent-growth-in-private-hospitals.html

GOVERNMENT INITIATIVES DRIVING DIAGNOSTICS INDUSTRY GROWTH

As diseases increasingly cross borders and health awareness grows worldwide, the sector is emerging as a critical piece of the countrys healthcare story. The Indian diagnostic industry is growing due to regulatory actions by the Government of India. A series of policies are launched to aid the sector and enhance its accessibility and affordability. These shifts are gradually but meaningfully reshaping how the diagnostics sector operates - and for organised players, which spells a significant long-term opportunity.

Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY)

The Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY), introduced in 2018, continues to be a cornerstone of Indias healthcare reform agenda, providing health insurance coverage of up toRs. 5 lakh per family for secondary and tertiary care hospitalisation. The scheme has significantly expanded access to healthcare services for economically vulnerable populations, leading to increased healthcare utilisation and earlier disease detection. The recent extension of coverage to senior citizens above the age of 70 further enhances the inclusivity and reach of the programme. The expansion of insurance coverage has also contributed to higher diagnostic volumes, as hospital-based care pathways increasingly incorporate structured testing and screening protocols.

Ayushman Arogya Mandirs (Health and Wellness Centres)

The government has made substantial progress in strengthening primary healthcare infrastructure through the expansion of Ayushman Arogya Mandirs, formerly known as Health and Wellness Centres. With over 1.78 lakh centres operational across the country, these facilities provide preventive, promotive, and basic diagnostic services at the grassroots level. The focus on early screening, particularly for non-communicable diseases, is enabling timely diagnosis and referral, thereby increasing demand for diagnostic services. This shift towards preventive care is expected to play a critical role in improving long-term health outcomes while driving sustained growth in diagnostic testing.

Ayushman Bharat Digital Mission (ABDM)

The Ayushman Bharat Digital Mission is driving the development of a unified digital health ecosystem in India. Through the creation of interoperable electronic health records and digital health identities, the initiative is enabling seamless data exchange across healthcare providers. With over 79 crore ABHA IDs generated and more than 65 crore health records linked, ABDM is improving continuity of care and enabling data-driven clinical decision-making. The digital integration of healthcare systems is also enhancing diagnostic accuracy, streamlining reporting processes, and improving overall patient experience.

e-Sanjeevani Telemedicine Platform

The governments e-Sanjeevani platform has emerged as a key enabler of telemedicine adoption in India, significantly improving healthcare access in remote and underserved regions. With over 37 crore consultations conducted through a hub-and-spoke model, the platform connects primary healthcare centres with specialists across the country. This expansion of telemedicine is increasingly integrating diagnostics into remote care pathways, particularly for follow-up testing, chronic disease monitoring, and specialist consultations.

PM Ayushman Bharat Health Infrastructure Mission (PM-ABHIM)

The PM Ayushman Bharat Health Infrastructure Mission (PM-ABHIM), with an outlay of approximately Rs.64,000 crore, aims to strengthen healthcare infrastructure across primary, secondary, and tertiary levels. The initiative focusses on enhancing diagnostic capacity, building critical care infrastructure, and improving preparedness for future public health emergencies. These investments are expected to improve healthcare access and strengthen the overall resilience of the healthcare ecosystem.

Free Diagnostics Services Initiative (FDSI)

The Free Diagnostics Services Initiative under the National Health Mission is aimed at improving affordability and accessibility of diagnostic services by providing essential tests at public health facilities. This initiative helps reduce out-of-pocket expenditure for patients while simultaneously increasing testing volumes and strengthening diagnostic infrastructure across government healthcare systems.

Production Linked Incentive (PLI) Scheme for Medical Devices

The Production Linked Incentive (PLI) Scheme for Medical Devices is designed to promote domestic manufacturing of high-value medical equipment, including diagnostic imaging devices such as CT scanners and MRI systems.

By reducing dependence on imports and encouraging local production, the scheme is expected to improve accessibility and affordability of advanced diagnostic technologies, while strengthening Indias position as a manufacturing hub for medical devices.

Biopharma SHAKTI Initiative

The Biopharma SHAKTI initiative represents a significant step towards strengthening Indias capabilities in pharmaceutical research, biotechnology, and advanced diagnostics. With a proposed allocation of approximately Rs.10,000 crore, the initiative aims to promote innovation, expand clinical trial infrastructure, and support the development of next-generation healthcare solutions. These efforts are aligned with broader industry trends, including increasing investments in high-value diagnostic segments such as genomics and oncology.

Sources: https://www.ibef.org/blogs/government-initiatives-boosting-the-healthcare-industry-in-india h t t p s : / / w w w. p i b . g o v. i n / P r e s s R e l e a s e P a g e . aspx?PRID=2151239&reg=3&lang=2 https://www.mohfw.gov.in/?q=en/pressrelease-271 https://nhsrcindia.org/free-diagnostics-service-initiative

COMPANY OVERVIEW

Metropolis Healthcare Limited ("Metropolis" or "the Company") is one of Indias leading and most trusted pathology laboratory chains, with over four decades of scientific excellence and a strong reputation for delivering accurate, reliable and high-quality diagnostic services. Established in 1981, the Company has built enduring trust among clinicians, patients and healthcare institutions through its unwavering commitment to quality, innovation and patient-centric care.

The Company operates a comprehensive diagnostics network across India and select international markets, supported by 210+ clinical laboratories, a 5,000+ service network, and a presence across 750+ towns in 28 States and 7 Union Territories. Its scalable hub-and-spoke operating model enables efficient sample logistics, faster turnaround times and consistent quality, while expanding access to advanced diagnostic services across diverse geographies. Internationally, Metropolis has established a strong presence across Africa through company-managed laboratories and collection centres in 5 African countries including Kenya, Zambia, Ghana, Tanzania and Uganda. In addition, the Company serve a diverse network of B2B partners across 16 international markets, including the UAE (Dubai and Abu Dhabi), Oman and Qatar in the Middle East; Bangladesh, Nepal, Sri Lanka, Maldives, Uzbekistan and Vietnam in Asia; and Mauritius, Nigeria, Congo, Cameroon, Sierra Leone and Zimbabwe in Africa.

Metropolis offers one of the industrys most comprehensive diagnostic portfolios, comprising over 4,500 tests and profiles across routine, specialised and super-speciality diagnostics. Its capabilities span molecular diagnostics, genomics, cytogenetics, oncology, infectious diseases, reproductive health, preventive healthcare and clinical research. Backed by 35 ISO 15189 accredited laboratories, including 31 in India, 4 in Kenya, and 2 CAP-accredited world-class laboratories, the Company continues to strengthen its position as a science-led diagnostics provider. Scientific excellence remains central to the Companys growth strategy. Metropolis continues to expand its specialty diagnostics portfolio through continuous innovation, advanced technologies and clinician engagement. The integration of Core Diagnostics has further strengthened its capabilities in high-end diagnostics, while the launch of Centre of Genomics continues to expand access to next-generation sequencing and precision diagnostics across the country. During FY 2025-26, the Company further enhanced its differentiated offerings through new test introductions across oncology, neurology, infectious diseases and women & child health, reinforcing its leadership in specialised diagnostics. The Company serves a diversified customer base through a balanced mix of B2C and B2B businesses. B2C contribute approximately 58% of revenues, while hospitals, corporates, institutions and other enterprise customers contribute the remaining 42%, providing resilience, diversification and sustainable growth. Increasing contribution from specialty diagnostics and the TruHealth wellness portfolio continues to improve the quality of revenues and strengthen the Companys premium positioning. Technology continues to play an increasingly important role in enhancing operational excellence and customer experience. The Company is leveraging automation, digital platforms and AI-enabled recommendation engines to improve productivity, strengthen customer engagement and expand preventive healthcare offerings. These capabilities, together with a robust quality framework and data-driven operations, enable Metropolis to deliver superior clinical outcomes while enhancing efficiency across its network. Supported by a trusted brand, strong scientific expertise, an extensive diagnostics network and a differentiated specialty diagnostics portfolio, Metropolis remains well positioned to capitalise on the long-term structural growth opportunities in the Indian diagnostics industry. The Companys continued focus on quality, innovation, operational excellence and disciplined expansion is expected to strengthen its leadership in high-value diagnostics and create sustainable long-term value for all stakeholders.

KEY STRATEGIC PRIORITIES

1. Expand Market Leadership through Network & Profitable Growth

Scale the business through disciplined network expansion, deeper penetration into Tier II, III and IV markets, and continued strengthening of the hub-and-spoke model. The Company will focus on improving asset utilisation, accelerating organic growth, integrating acquisitions, and expanding specialty diagnostics and preventive healthcare to deliver sustainable, profitable growth and long-term shareholder value.

2. Lead the Future of Diagnostics through Technology & Digital Innovation

Accelerate digital transformation by leveraging Artificial Intelligence, automation, advanced analytics and connected digital platforms to enhance diagnostic accuracy, improve operational productivity and deliver a seamless omnichannel experience. Technology will continue to serve as a strategic growth engine, enabling scalability, efficiency and superior customer engagement.

3. Differentiate through Science, Innovation & Clinical Excellence

Strengthen leadership in specialised diagnostics by expanding genomics, molecular diagnostics, precision medicine and high-end pathology capabilities. Continued investment in scientific innovation, quality systems, clinician engagement and advanced laboratory technologies will reinforce Metropolis position as Indias most trusted science-led diagnostics company.

4. Build a Trusted Consumer-Centric Healthcare Ecosystem

Deepen engagement with patients, clinicians and institutional partners through superior service quality, preventive healthcare offerings, personalised wellness solutions and digital health platforms. The Company will continue to strengthen brand trust by delivering consistent, ethical and patient-centric healthcare experiences across every touchpoint.

5. Drive Operational Excellence & Capital Discipline

Enhance productivity through continuous process optimisation, intelligent automation, strategic procurement, disciplined capital allocation and structured acquisition integration. The focus remains on improving operating leverage, expanding margins and building a scalable business capable of delivering sustainable long-term returns.

These strategic priorities are underpinned by robust corporate governance, enterprise risk management, ethical business practices, regulatory compliance, information security and a culture of accountability, ensuring sustainable value creation for all stakeholders.

EMERGING TRENDS IN DIAGNOSTIC INDUSTRY Digital and AI-Driven Diagnostics

Artificial Intelligence (AI), advanced analytics and digital technologies are transforming diagnostic workflows by improving analytical accuracy, reducing turnaround times and enabling predictive insights. The increasing adoption of intelligent automation, AI-assisted diagnostics and connected digital platforms is strengthening data-driven clinical decision-making across pathology, radiology and genomics. Metropolis continues to invest in AI-assisted diagnostic workflows, digital platforms and intelligent automation to enhance operational efficiency, strengthen scientific capabilities and deliver more accurate, technology-enabled diagnostics.

Rising Adoption of Preventive and Wellness Testing

Growing health awareness, increasing lifestyle-related diseases and rising consumer focus on early detection are accelerating demand for preventive healthcare and routine wellness testing. Wellness diagnostics continue to outpace the broader diagnostics market, supported by corporate wellness programmes, digital health adoption and expanding insurance coverage. Metropolis is strengthening its preventive healthcare ecosystem through TruHealth, personalised wellness offerings, AI-enabled health insights and expanding digital and home-based service capabilities to improve accessibility and customer engagement.

Growth of Specialised and High-Value Diagnostics

The increasing prevalence of chronic diseases and the growing adoption of precision medicine are driving demand for specialised diagnostics, including molecular diagnostics, genomics and oncology testing. These high-value segments continue to improve the industrys clinical relevance and revenue mix. Metropolis is expanding its specialised diagnostics portfolio through the Centre of Genomics, advanced molecular diagnostics, next-generation sequencing (NGS) and continuous investment in scientific innovation to strengthen its leadership in precision diagnostics.

Acceleration of Point-of-Care and Home-Based Diagnostics

Consumer preference for convenient and technology-enabled healthcare continues to drive demand for home sample collection, digital engagement and connected diagnostic services. Digital health solutions are improving accessibility while enabling more seamless patient experiences. Metropolis continues to strengthen its omnichannel service model through enhanced home collection services, digital platforms, mobile applications and technology-enabled customer journeys, improving convenience, accessibility and service responsiveness.

Personalised and Preventive Diagnostics: Shift towards Proactive Healthcare

Healthcare is increasingly shifting from reactive treatment to proactive prevention, with growing consumer demand for genetic testing, early cancer screening, wellness panels, and chronic disease risk profiling. AI-enabled analytics and longitudinal health data are supporting predictive risk assessment, enabling more informed clinical decision-making and improved patient outcomes. The Company continues to strengthen its capabilities in personalised and preventive diagnostics, including initiatives to enhance early detection and expand access to screening solutions.

Industry Consolidation and Strategic Ecosystem Integration

The diagnostics sector in India continues to consolidate, with organised players gaining share from fragmented local laboratories. Larger chains are acquiring regional players to build scale, expand geographic reach, and standardise quality. In parallel, partnerships across health-tech, pharmaceutical, and public health ecosystems are enabling more integrated healthcare delivery models. The Company is aligned with this trend through selective acquisitions and collaborations aimed at strengthening its network and service capabilities.

Regulatory Focus and Quality Standardisation

Increasing regulatory oversight and greater emphasis on accreditation, quality assurance and laboratory standardisation are raising industry benchmarks and reinforcing the importance of scientific credibility. Metropolis continues to strengthen its quality ecosystem through NABL-accredited laboratories, internationally recognised quality standards, digital quality monitoring and robust governance practices, reinforcing trust, consistency and diagnostic excellence across its network.

MAJOR GROWTH DRIVERS AND OPPORTUNITIES Rising Burden of Lifestyle and Chronic Diseases

India is witnessing a sustained increase in non-communicable diseases (NCDs), including cardiovascular diseases, diabetes, cancer and respiratory disorders, driving higher demand for specialised diagnostics, chronic disease monitoring and early detection. The increasing need for timely diagnosis is expanding the role of organised diagnostic providers. Metropolis is well positioned to capitalise on this trend through its comprehensive test portfolio, specialised diagnostics capabilities and expanding preventive healthcare offerings, enabling early diagnosis and improved disease management.

Demographic Shifts and Ageing Population

Indias ageing population is expected to drive increasing demand for preventive health assessments, chronic disease management and age-related diagnostics. Longer life expectancy and rising healthcare awareness are creating sustained demand for regular monitoring and personalised care. Metropolis is strengthening its preventive healthcare ecosystem, specialised diagnostics and wellness solutions to address the evolving healthcare needs of an ageing population.

Expansion in Tier II and Tier III Markets

Tier II and Tier III cities continue to emerge as significant growth markets, supported by improving healthcare infrastructure, rising incomes and increasing awareness of quality diagnostics. Organised diagnostic players are expected to benefit from expanding access and increasing formalisation of the sector. Metropolis continues to deepen its presence across these markets through network expansion, hub-and-spoke infrastructure and technology-enabled service delivery, improving accessibility while supporting sustainable long-term growth.

Increasing Health Insurance Penetration

The expansion of health insurance coverage through government schemes and private insurers is improving affordability and encouraging greater utilisation of diagnostic services. As financial barriers reduce, preventive and routine diagnostic testing is expected to witness stronger adoption. Metropolis is well positioned to benefit from this trend through its diversified service offerings, institutional partnerships and growing preventive healthcare portfolio.

Rising Income Levels and Health Awareness

Higher disposable incomes, increasing health awareness and changing consumer behaviour are accelerating demand for preventive healthcare and wellness diagnostics. Consumers are increasingly seeking routine health assessments, personalised health insights and early disease detection. Metropolis continues to strengthen its consumer-centric healthcare offerings through TruHealth, digital engagement platforms and personalised wellness solutions, supporting higher customer engagement and long-term growth.

Government Support and Policy Initiatives

Government initiatives focussed on expanding healthcare infrastructure, strengthening digital health ecosystems and improving healthcare accessibility continue to create favourable long-term opportunities for the diagnostics industry. Programmes such as Ayushman Bharat and the Ayushman Bharat Digital Mission (ABDM) are expected to improve access to organised diagnostic services. Metropolis continues to align its technology, quality systems and digital infrastructure with evolving healthcare priorities while expanding access to quality diagnostics across the country.

Growth of Preventive Healthcare and Wellness Testing

Preventive healthcare and wellness diagnostics continue to be among the fastest-growing segments of the diagnostics industry, driven by increasing health consciousness, corporate wellness programmes and demand for early disease detection. This shift towards proactive healthcare is expected to support sustained growth in routine diagnostic testing. Metropolis continues to strengthen its preventive healthcare portfolio through TruHealth, integrated wellness solutions and personalised health programmes, enabling consumers to take a more proactive approach towards health management.

Global Opportunity for Indian Diagnostics Players

Indias scientific expertise, cost competitiveness and improving quality standards are creating opportunities for organised diagnostic companies to participate in the global diagnostics value chain. Growing acceptance of Indian laboratories and increasing demand for specialised testing present attractive long-term opportunities. Metropolis continues to strengthen its scientific capabilities, quality systems and advanced diagnostics infrastructure, positioning the Company to participate in emerging opportunities across specialised and international diagnostics.

THREATS

Workforce Shortage and Skill Gaps

The diagnostics industry continues to face a shortage of skilled professionals, including pathologists, radiologists, lab technicians, and phlebotomists. This challenge is more pronounced in rural and semi-urban regions, where access to trained talent remains limited, potentially impacting service quality and expansion. Increasing regulatory requirements for accredited laboratories to employ qualified personnel, along with the need for continuous upskilling amid technological advancements, further add to talent-related pressures.

Competitive Intensity and Pricing Dynamics

The diagnostics industry continues to witness increasing competition from organised chains, hospital-based laboratories, and new entrants including digital health platforms and pharmaceutical companies. While pricing discipline has improved in recent years, competitive intensity may impact test realisations and volume growth, particularly in routine diagnostics, thereby exerting pressure on margins.

High Capital Expenditure and Operational Costs

Sustaining competitiveness requires ongoing investment in advanced diagnostic technologies, including molecular diagnostics and high-end imaging systems. These investments involve significant capital expenditure, along with recurring maintenance and infrastructure costs. The need for specialised personnel to operate such technologies further adds to operational expenses, which may impact profitability, particularly for smaller and mid-sized players.

Supply Chain Dependence and Import Exposure

The diagnostics sector remains dependent on imports for a significant proportion of reagents, consumables, and high-value medical equipment. This reliance exposes the industry to global supply chain disruptions, currency volatility, and geopolitical risks, which may lead to cost pressures and potential supply constraints.

Digital Transformation and Data Security Risks

While digitalisation is enhancing efficiency and access, it also introduces challenges related to infrastructure gaps and data security. The digital divide between urban and rural areas may limit the reach of technology-enabled services. Additionally, increasing digitisation of patient data heightens cybersecurity and data privacy risks, necessitating continued investment in secure systems and compliance frameworks.

Regulatory Complexity and Compliance Challenges

The regulatory landscape for diagnostics in India remains fragmented, with varying levels of adoption and enforcement across states. This lack of uniformity can increase compliance complexity for multi-location operators and may impact standardisation of service quality across regions.

Presence of Unorganised and Unregulated Laboratories

A significant portion of the diagnostics market continues to be served by unorganised players, including laboratories operating without standardised accreditation or quality controls. This may affect overall service reliability and pricing dynamics within the industry, while also posing challenges to organised players focussed on maintaining high quality and compliance standards.

PERFORMANCE OVERVIEW Business Performance

Metric	FY 2022-23	FY 2023-24	FY 2024-25	FY 2025-26
Revenue Per Patient (Rs.)	944	1006	1050	1164
Revenue Per Test (Rs.)	453	497	504	553
Laboratory Network	175	199	210	212
Service Network	3675	4150	4536	5026

Financial Performance (Rs. in crores)

Metric	FY 2022-23	FY 2023-24	FY 2024-25	FY 2025-26
Revenue from Operations	1148	1190	1331	1646
EBITDA	293	285	325*	401
Profit After Tax	143	128	161*	191

FY 2025-26 Performance Review

FY 2025-26 was a year of disciplined execution and broad-based growth, as the Company successfully translated its strategic priorities into strong financial and operational performance. At the MHL Group level*, revenue from operations increased by 24% to Rs.1,646 crore, while EBITDA grew by 32% to Rs.401 crore, with EBITDA margin improving to 24.4%. Profit After Tax (PAT) increased by 31% to Rs.191 crore, reflecting improved operating leverage, disciplined cost management and the successful integration of acquired businesses. The previous years reported EBITDA and PAT included one-time expenses of approximately Rs.21 crore, primarily relating to acquisition-related costs, legal and professional fees associated with ongoing tax matters, and a minor inventory provision.

The Companys performance was underpinned by sustained demand across both consumer and institutional segments, supported by healthy patient volume growth, an improved test mix and continued momentum in specialised diagnostics. On an MHL Organic basis, patient volumes increased by 7.5% to 13.5 million, while test volumes grew by 8.0% to 28.4 million.* Revenue per patient improved by 6%, reflecting a higher contribution from specialty diagnostics and preventive healthcare offerings. Organic B2C revenue grew by 14%, while B2B revenue increased by 13% in FY26. TruHealth and Specialty Diagnostics recorded growth of 21% and 16%, respectively for organic business, reinforcing the Companys strategy of driving premiumisation and enhancing revenue quality.

Operationally, the Company further strengthened its long-term growth platform through strategic acquisitions, network expansion and technology-led transformation. During the year, Metropolis successfully integrated Dr Ahujas Pathology and Imaging Centre (DAPIC) in Dehradun, Scientific Pathology in Agra and Ambika Pathology in Kolhapur into its operating platform, while progressing the integration of Core Diagnostics. The Company expanded its footprint by adding approximately 490 service centres, taking its network to 5,026 service touchpoints across more than 750 towns, thereby strengthening its presence in high-growth markets and improving access to quality diagnostics. Investments in digital capabilities, automation, scientific innovation and operational excellence further enhanced customer experience, productivity and scalability, reinforcing the Companys differentiated, technology-enabled and science-led operating model.

*MHL Group: Includes recent acquisitions of Core Diagnostics, Delhi NCR; Dr. Ahujas Pathology & Imaging Centre (DAPIC), Dehradun; Scientific Pathology, Agra; and Ambika Pathology, Kolhapur.

*MHL Organic: Excludes the financial performance of all acquired entities.

*FY25 EBITDA and PAT are normalized excluding one-time expenses.

Details of Key Ratios*

Key Financial Ratios	FY 2024-25	FY 2025-26	Variance (%)
Debtors Turnover	9.98	11.74	17.6%
Inventory Turnover	7.47	7.93	6.1%
Interest Coverage Ratio	2.41	2.20	-8.5%
Current Ratio	1.05	1.30	24.8%
Debt-Equity Ratio	NA	NA	NA
Operating Profit Margin (%)	22.11%	24.77%	12.0%
Net Profit Margin (%)	10.28%	11.51%	11.9%
Return on Net Worth Ratio (%)*	10.93%	11.96%	9.4%

*Return on Net Worth Ratio: The Company declared a dividend during FY 2025-26 which reduced shareholders equity and consequently lowered the denominator used in the computation of the ratio. In addition, the increase in Profit After Tax during the year contributed to the improvement in the Return on Net Worth as compared to the previous year.

STRATEGIC ACQUISITIONS AND INTEGRATION

During FY 2025-26, the Company completed three strategic acquisitions that strengthened its presence in high-growth regional markets. DAPIC Metropolis Healthcare Private Limited (formerly known as Metropolis Histoxpert Digital Services Private Limited), a wholly-owned subsidiary of Metropolis Healthcare Limited, acquired the entire business of Dr. Alok Ahuja and Dr. Alka Ahuja and Dr. Ahujas Pathology & Imaging Centre (DAPIC), a partnership firm of Dr. Alok Ahuja and Dr. Alka Ahuja, as a going concern, effective May 23, 2025.

Further, Scientific Metropolis Pathology Private Limited (formerly known as Metropolis Clinical Pathology Private Limited), a subsidiary of Metropolis Healthcare Limited, acquired the entire business of Dr. Ashok Kumar Sharmas Scientific Pathology, a sole proprietorship firm of Dr. Ashok Kumar Sharma, as a going concern, effective June 16, 2025. The Company also acquired the entire business of Dr. RS Patils Ambika Pathology Laboratory, a sole proprietorship firm of Dr. Rajendra Sadashiv Patil, comprising pathology laboratories in Kolhapur, Maharashtra, as a going concern, with effect from September 18, 2025.

From Acquisition to Integration — and Next, Acceleration

FY 2025-26 marked a year in which the Company demonstrated its ability to integrate acquired businesses effectively. The Company follows a structured integration playbook: the first year focusses on integration and synergy capture, the second on revenue acceleration, and the third on convergence towards company-level margins. Guided by a dedicated steering committee, the Company integrated four acquisitions – Core Diagnostics, Scientific Pathology, DAPIC, and Ambika Pathology-into its operating platform by merging overlapping laboratories, consolidating procurement, standardising operating procedures, and aligning teams around a common performance architecture.

The benefits of this disciplined approach are already evident. Core Diagnostics exited the year with high single-digit EBITDA margins and has emerged as a strategic platform for the Companys oncology and genomics businesses. Scientific Pathology and DAPIC delivered growth in line with the Company while operating at margins above the Company average. In Kolhapur, the integration of Ambika Pathology strengthened the Companys regional leadership by creating the largest laboratory in the market. Together, the acquired businesses contributed approximately 8% of Group revenue and increased North Indias share of the Companys business from 8% to 17%.

With the first phase of integration complete, FY 2026-27 will mark the beginning of the second phase-accelerating growth by cross-selling specialised test menus across acquired channels, deepening clinician engagement, and widening access to specialised diagnostics, supported by an integration framework that the Company has now institutionalised for future opportunities.

RESTRUCTURING

During the year, the Company on February 04, 2026, entered into a Business Transfer Agreement to transfer its External Quality Assessment Services (EQAS) business to its wholly-owned subsidiary, Metropolis Quality Solutions Private Limited (MQSPL), on a going concern basis. The transfer is intended to enable the EQAS business to operate as a separate and independent unit, focussing on its core services, with dedicated management and resources to drive efficiency, excellence, and growth potential. The transfer consideration is up to Rs.1.25 crore, subject to closing adjustments, and is proposed to be discharged through cash and/or issuance of equity shares by MQSPL.

IT & DIGITAL INFRASTRUCTURE

Technology continued to be a key strategic enabler of Metropolis Healthcare Limiteds ("the Company") growth strategy during FY 2025-26. The Company remained focussed on strengthening its digital infrastructure, enterprise platforms and intelligent technologies to enhance operational efficiency, improve customer engagement and build a scalable, future-ready diagnostics ecosystem. Continued investments in digital transformation have strengthened business agility, scientific capabilities and operational resilience, reinforcing technology as a key differentiator in delivering high-quality diagnostic services.

During the year, Metropolis further advanced its customer-centric digital strategy through enhanced omnichannel engagement, customer lifecycle management and the launch of its next-generation mobile application, providing patients with a more seamless and convenient digital experience. Simultaneously, continued investments in integrated Customer Relationship Management (CRM), Customer Data Platform (CDP) and Laboratory Information Systems (LIS/ LIMS) strengthened enterprise-wide collaboration, data-driven decision-making and workflow integration, enabling greater operational agility and supporting scalable business growth.

The Company also expanded the adoption of Artificial Intelligence (AI), advanced analytics and intelligent automation across clinical, operational and customer engagement processes. AI-assisted technologies are supporting improved diagnostic accuracy, workflow optimisation, reporting consistency and faster turnaround times, while enhancing productivity across laboratory operations. Continued investments in connected digital platforms, automation and intelligent workflows have strengthened process standardisation, operational visibility and organisational efficiency, enabling the Company to respond more effectively to evolving customer and business requirements. Cybersecurity, information governance and patient data privacy remained integral to the Companys digital strategy. Metropolis continued to strengthen its cyber resilience through secure digital architecture, enterprise governance frameworks, continuous monitoring and robust information security practices. The Company maintains ISO 27001 and ISO 27701 certifications, reflecting its commitment to globally recognised standards for information security and privacy management. Continued investments in secure, scalable and connected technology platforms are strengthening business continuity, operational resilience and the Companys long-term competitive position in an increasingly digital and data-driven healthcare environment. Overall, the Companys sustained investments in digital infrastructure, intelligent automation and enterprise technologies have strengthened its technology-enabled operating model, enhanced customer experience, improved productivity and reinforced its ability to deliver differentiated, science-led diagnostic services. These capabilities position Metropolis to capitalise on emerging opportunities while supporting sustainable, profitable and technology-driven growth.

QUALITY AND SCIENTIFIC EXCELLENCE

Quality and scientific excellence remain the cornerstone of Metropolis Healthcare Limiteds ("the Company") competitive differentiation and long-term growth strategy. The Company has embedded quality across every stage of the diagnostic value chain through its enterprise-wide Quality Intelligence Framework, which integrates governance, digital quality analytics, standardised laboratory practices, accreditation, scientific oversight and a culture of continuous improvement. This integrated framework strengthens diagnostic accuracy, operational consistency and regulatory compliance, while reinforcing trust among patients, clinicians and institutional partners.

During FY 2025-26, the Company maintained 99.9% report accuracy and achieved 100% compliance with

ISO 15189:2022 across its accredited laboratories, while continuing to strengthen quality governance through its proprietary Quality Index and technology-enabled quality monitoring systems.

Scientific innovation continued to strengthen the Companys leadership in specialised diagnostics. During the year, Metropolis strengthened its portfolio by adding 345 diagnostic tests through new launches and the integration of the Core Diagnostics portfolio. These included 224 next generation sequencing (NGS) tests and 50 precision oncology assays, further supporting growth in genomics. The Company further strengthened its Centre of Genomics through two CAP-accredited laboratories, the commissioning of the Illuminas NovaSeq™ X Series and collaborations with leading academic institutions, enhancing its capabilities in precision diagnostics and advanced molecular testing. During the year, Metropolis also became the first listed diagnostics company in India to receive a patent in tuberculosis diagnostics, reinforcing its commitment to scientific innovation, indigenous research and differentiated diagnostic capabilities.

The Company continues to strengthen scientific leadership through research, medical education and capability development, while investing in the next-generation of healthcare professionals through the Metropolis Institute of Laboratory Education & Skilling (MiLES). These initiatives reinforce the Companys position as a trusted, science-led diagnostics organisation and support its long-term strategy of delivering differentiated, high-quality diagnostic services.

HUMAN RESOURCE MANAGEMENT

People remain one of Metropolis Healthcare Limiteds ("the Company") most valuable assets and a key driver of sustainable growth. Supported by a workforce of over 6,000 professionals, the Company continues to invest in leadership development, scientific capability, workforce productivity and employee experience, building a resilient and future-ready organisation aligned with its long-term growth strategy.

During FY2025–26, the Company strengthened its capability-building ecosystem through structured learning, technical certification, leadership development and continuous upskilling. Investments in role-based learning, scientific training and digital capability enhancement enabled employees to adapt to evolving technologies, improve productivity and deliver high standards of diagnostic excellence. These initiatives strengthened organisational agility while supporting business expansion and operational excellence.

The Company also continued to strengthen its leadership pipeline through structured development programmes, succession planning and a culture of accountability, collaboration and continuous improvement. These initiatives, together with investments in technology and process excellence, contributed to higher workforce productivity, reflected in a 15% increase in revenue per employee during the year.

Metropolis remains committed to fostering a diverse, equitable and inclusive workplace. Women represent 44% of the Companys workforce, with increasing participation across scientific, clinical and leadership roles. Through initiatives such as Full Circle – Career 2.0, the Company continues to expand opportunities for women professionals while strengthening diversity, inclusion and leadership representation across the organisation.

By continuing to invest in its people, leadership capabilities and organisational culture, Metropolis is strengthening its ability to innovate, scale responsibly and deliver sustainable value for patients, employees and shareholders.

ENVIRONMENT, SOCIAL AND GOVERNANCE (ESG)

Sustainability is integral to Metropolis Healthcare Limiteds ("the Company") long-term growth strategy and value creation. The Company continues to embed environmental stewardship, social responsibility and strong governance across its operations, strengthening business resilience, operational excellence and stakeholder trust. During FY 2025-26, Metropolis further advanced its ESG agenda through initiatives focussed on resource efficiency, employee well-being, patient experience, ethical governance and community impact.

The Company continues to progress towards its long-term ESG commitments through investments in energy efficiency, renewable energy, responsible resource management and waste reduction, while increasing digitalisation has further improved operational efficiency and reduced resource consumption. Simultaneously, continued investments in people, diversity and inclusion, patient-centric care and information security have strengthened organisational resilience and stakeholder confidence.

Metropolis also expanded its social impact through flagship CSR initiatives focussed on adolescent health, preventive healthcare and medical education, creating measurable outcomes for underserved communities. Going forward, these programmes will be integrated under the METCARE Framework, providing a structured approach to impact measurement, programme governance and long-term community development.

Strong governance remains fundamental to the Companys ESG approach. Supported by robust risk management, ethical business practices and effective Board oversight, Metropolis continues to strengthen transparency, accountability and sustainable value creation for all stakeholders.

RISK MANAGEMENT

Metropolis Healthcare Limited ("the Company") recognises that effective risk management is integral to sustainable value creation and long-term business resilience. The Companys enterprise risk management framework is embedded within its governance processes and strategic decision-making, enabling the proactive identification, assessment and management of strategic, operational, financial, regulatory and emerging risks. Guided by the Boards Risk Management Committee, the framework promotes a risk-aware culture across the organisation while ensuring that appropriate mitigation measures and internal controls are regularly reviewed to support business continuity, regulatory compliance and sustainable growth.

Key Risks and Mitigation Strategies

Risk	Impact	Mitigation Plan
	The Company operates in an intensely competitive environment influenced by both global and domestic players. Emerging competitors and evolving business models may increase pricing pressure and influence market share. Although the diagnostics industry benefits from growing demand and long-term expansion potential, heightened competition may affect pricing power and margins, which could impact profitability and returns.	To mitigate the impact of increasing competition, the Company continues to strengthen its competitive position through scientific differentiation, expansion of specialised diagnostics, superior customer experience and sustained investments in digital capabilities. It remains focussed on cost optimisation, operational excellence and productivity enhancement to strengthen margins, improve return ratios and drive sustainable growth.
Competition Risk		Simultaneously, the Company continues to expand its laboratory network and customer touchpoints, improving accessibility, deepening market penetration and supporting volume-led growth. The Companys core business, particularly acute illness diagnostics, remains relatively resilient to competitive disruption, providing stability in a dynamic market environment. In addition, a dedicated Competition Desk continuously monitors market dynamics, pricing trends, competitive benchmarks and emerging business models, enabling timely strategic interventions and reinforcing the Companys competitive positioning.
Technology & Innovation Risk	In a rapidly evolving technological landscape, the Company faces the risk that emerging technologies and continuous innovation could render existing systems, platforms or services less competitive. The increasing adoption of automation, artificial intelligence (AI), digital platforms and advanced diagnostics is reshaping the industry, requiring continuous investments in technology upgrades, innovation and capability enhancement to maintain operational efficiency, service excellence and long-term competitiveness.	To address this risk, Metropolis continues to invest in advanced technologies, laboratory automation, artificial intelligence (AI) and digital platforms to enhance diagnostic accuracy, operational efficiency and customer experience. The Company is strengthening its technology ecosystem through laboratory platform standardisation, intelligent workflow automation, AI-enabled diagnostic solutions and enterprise-wide digital transformation initiatives. Continuous investments in modern laboratory infrastructure, scientific innovation and employee capability development ensure the organisation remains agile, technologically relevant and well positioned to respond to evolving industry requirements.
IT Disruptions and System Failure Risk	Given the Companys extensive reliance on technology and data systems, any malfunction, cyberattack, or operational disruption could negatively impact business continuity and service delivery. Failure to maintain robust information security and governance frameworks may expose the Company to risks such as data breaches, operational interruptions, and reputational damage.	Metropolis has established a robust information security and cybersecurity framework, supported by ISO 27001 and ISO 27701 certifications, reflecting its commitment to globally recognised standards for information security and privacy management. The Company continuously strengthens its cyber resilience through secure IT architecture, governance frameworks, regular vulnerability assessments, penetration testing and independent third-party audits. Continuous monitoring, preventive controls and periodic disaster recovery testing further enhance business continuity, safeguard patient data and ensure uninterrupted operations.
Business Continuity Risk	Business operations may be disrupted by external events such as natural disasters, public health emergencies, civil disturbances, geopolitical developments or supply chain interruptions. Such events could impact laboratory operations, logistics, service delivery and the Companys ability to provide uninterrupted diagnostic services.	Metropolis has established a comprehensive Business Continuity Planning (BCP) and Disaster Recovery (DR) framework across its Global Reference Laboratory (GRL) and Regional Reference Laboratories (RRLs). Dedicated BCP and DR sites, supported by defined response protocols, periodic testing and continuous monitoring, help ensure operational resilience, minimise service disruptions and maintain uninterrupted diagnostic services during unforeseen events.

 

Regulatory & Quality Compliance Risk	The diagnostics industry operates in an evolving regulatory environment with increasing emphasis on laboratory accreditation, quality standards, patient safety and data privacy. Changes in regulations or non-compliance could impact operations, reputation and business continuity.	Metropolis has established a robust enterprise-wide Quality Intelligence Framework that integrates quality governance, standardised operating procedures, technology-enabled quality monitoring and continuous performance surveillance across its laboratory network. Supported by NABL-accredited laboratories, CAP-accredited facilities, external quality assurance programmes, internal audits and structured governance reviews, the framework enables proactive identification of quality risks, timely corrective actions and continuous improvement. This integrated approach ensures compliance with evolving regulatory requirements while reinforcing diagnostic accuracy, operational consistency and scientific excellence across the organisation.
Supply Chain Risk	Dependence on imported reagents, consumables and specialised laboratory equipment exposes the Company to supply disruptions, geopolitical uncertainties, foreign exchange volatility and inflationary pressures, potentially affecting service continuity and costs.	The Company strengthens supply chain resilience through strategic sourcing, supplier diversification, inventory optimisation and long-term partnerships with leading global OEMs. Laboratory platform standardisation, strategic procurement, supplier consolidation and reagent rental optimisation further enhance supply reliability, improve cost efficiencies and ensure uninterrupted availability of critical reagents and consumables across the network.
Talent Capability Risk	The diagnostics industry is highly dependent on specialised talent. The ability to attract, develop and retain skilled pathologists, scientists, laboratory professionals and digital talent remains critical to delivering high-quality diagnostics, driving innovation and supporting the Companys long-term growth strategy.	The Company continues to invest in leadership development, succession planning and scientific capability building to develop a future-ready workforce. Initiatives such as the Metropolis Institute of Laboratory Education & Skilling (MiLES), specialised technical training, digital learning platforms and employee engagement programmes strengthen technical expertise, leadership capabilities and organisational resilience, supporting sustainable long-term growth.
Acquisition & Integration Risk	Delays or challenges in integrating acquired businesses may impact operational efficiencies, synergy realisation, customer experience and the timely delivery of expected strategic and financial benefits.	The Company has established a dedicated cross-functional Integration Management Office (IMO) supported by structured governance, defined integration roadmaps and regular leadership reviews to facilitate seamless integration of acquired businesses. Standardised operating procedures, laboratory platform harmonisation, technology integration and quality standardisation enable timely realisation of operational and commercial synergies while ensuring a consistent customer experience. The Companys structured acquisition integration playbook further supports disciplined execution and accelerates value creation across acquired entities.
Reputation & Brand Trust Risk	Diagnostic accuracy, service quality, patient safety and stakeholder trust are fundamental to the Companys reputation. Any quality lapse, service disruption, adverse publicity or failure to meet customer expectations could impact stakeholder confidence, brand equity and business performance.	Metropolis reinforces trust through its enterprise-wide Quality Intelligence Framework, robust quality governance and a strong culture of scientific excellence. Supported by NABL-accredited laboratories, CAP-accredited facilities, standardised laboratory practices, external quality assurance programmes and continuous quality monitoring, the Company maintains high standards of diagnostic accuracy and operational consistency. Customer feedback mechanisms, transparent communication and continuous investments in technology, service excellence and employee capability development further strengthen stakeholder confidence and reinforce the Metropolis brand.

INTERNAL CONTROL SYSTEM

Metropolis Healthcare has instituted a robust internal control framework that governs both financial and operational functions across the organisation. These controls are supported by well-documented policies and standard operating procedures designed to ensure accurate financial reporting, operational integrity, regulatory compliance, and asset protection.

The internal control system provides reasonable assurance regarding the reliability of financial and operational information, safeguarding of assets against unauthorised use or losses, and adherence to applicable laws and regulations. Regular reviews are conducted to assess and enhance the effectiveness of these controls.

The internal audit function, with a clearly-defined scope and coverage, plays a critical role in evaluating and strengthening the control environment. Key focus areas include:

• Identifying and reporting key process risks

• Verifying compliance with statutory requirements and internal guidelines

• Recommending measures to improve process efficiency and operational effectiveness

• Ensuring the accuracy and dependability of financial and operational data.

The Audit Committee of the Board provides active oversight, regularly reviewing significant internal audit findings and tracking corrective actions. It also monitors adherence to accounting standards, evaluates the adequacy of risk management practices, and ensures that control mechanisms are aligned with the Companys overall governance objectives. This structured and proactive approach to internal controls underpins Metropolis Healthcares commitment to transparency, accountability, and sound corporate governance.

COMPANY OUTLOOK

The long-term outlook for the Indian diagnostics industry remains favourable, supported by rising healthcare awareness, increasing adoption of preventive healthcare, growing demand for specialised diagnostics and genomics, expanding health insurance coverage and the continued shift towards organised, quality-led diagnostic providers. These structural trends are expected to create significant long-term opportunities for established players with strong scientific capabilities, trusted brands and scalable operating models.

Building on the strong foundations established over the past few years, Metropolis Healthcare Limited ("the Company") is well positioned to capture these opportunities through its differentiated scientific expertise, technology-enabled operating model, expanding network and customer-centric approach. Going forward, the Company will remain focussed on driving sustainable growth through productivity enhancement, operational excellence, specialty diagnostics, digital transformation and disciplined capital allocation, while continuing to strengthen its market leadership.

Supported by a strong balance sheet, robust governance framework and a disciplined execution strategy, the Company remains confident of delivering sustainable, profitable growth and creating long-term value for patients, clinicians, shareholders and all other stakeholders.

CAUTIONARY STATEMENT

Statements in this Management Discussion and Analysis that describe the Companys objectives, projections, estimates, expectations, or forecasts may be considered forward-looking statements under applicable securities laws and regulations. Actual outcomes may differ materially from those indicated or implied in such statements. Several factors could influence the Companys performance, including demand for diagnostic services, competitive intensity and pricing dynamics, availability and cost of reagents, consumables and diagnostic equipment, dependence on imports and potential supply chain disruptions, availability and retention of skilled medical and technical personnel, changes in healthcare regulations, accreditation requirements, government policies and tax regulations, developments relating to data privacy and cybersecurity, economic conditions in India and in other countries where the Company operates, as well as potential impacts from litigation. The Company undertakes no obligation to publicly update, amend, or revise any forward-looking statements in light of new information, future events, or other developments.