Just my guess, I could be wrong - they are not essential services from a B2C perspective, but they should be getting blood samples from small (and some big) hospitals/labs (B2B)…but not sure about the logistics/transportation of samples to the testing lab???
Ironic that Dr V believed that Thyrocare’s strength is “wellness” and not “sickness”, but at the moment covid sickness is taking this company forward and he is in the limelight, and for good reasons!!
Discl- holding and adding from IPO
My thoughts on blood antibody testing (as compared to nasal swab PCR testing)
Nasal swab PCR testing is to diagnose acute covid infection - this is the only test as far as I am aware to diagnose covid infection (labour intensive, unpleasant and difficult to do mass testing)
Blood antibody testing (IgG and IgM) - positive test indicates past infection and immunity (time will reveal how long this immunity will last). Nasal swab will be negative in patients who have recovered from covid infection.
I see much greater opportunity for thyrocare in blood antibody testing, why?
@ravish - I am afraid you are totally wrong in your assumption - please makes sure that your facts are right before posting.
Covid antibody test is specific against covid - so it will tell you whether you have been infected in the past with covid or not
There are other antibody tests for other viruses - hepatitis, dengue etc. Not all antibody tests are the same - this was your assumption.
Malaria testing is not antibody based!!
Discl - invested
I started tracking this company very recently. I started going through some of the interviews by Mr. A.Velumani. I am surprised by the fact that he uses ‘I’ instead of company (or better we ). I know he is from humble background and very passionate about what he is doing but some how i get the feeling that he thinks he is bigger than the organization itself? Is there any second line management?
Disc- Tracking
I too initially felt that was but after tracking company and him , I felt that its his individual style and I was reading too much in to or over analyzing him saying I / I etc during discussions.
just sharing my experience
I was going through some of the interviews by him to the various news channels , Around 2018 he was guiding 20-25% growth in top line but sales in 2019 and TTM sales is around 12-13%. I did go through AR where he talks about how they had to do price cuts and one of the subsidiary making losses.Still i believe the deviation is way too much from the guidance. At the current rate of sales growth stock is highly overvalued. Any thoughts?
Only in the last 1-2 con-calls, he started letting other ppl speak . All his team is home grown. They have a policy of not hiring laterals.
I was looking at employee reviews for this company on glassdoor and it seems very negative. Maybe someone should raise this question (Rating is 2.5/5)
If so many employees are unhappy, something will go wrong.
Nueclear business impairment 44 crores!
The board should have accepted Dr V’s offer last year
PET CT business model (capex and opex heavy - positive cashflow only if assets are well utilised) is exactly the opposite to their lab business model (capex light, opex heavy - good cashflow) and hence a misfit. These machines are sitting idle now and will be so for many months…
I am very confident of their lab business model and this business will do very well. But, I am very negative about their radiology business.
Discl - accumulating from IPO, currently 20% of my portfolio
Covid testing
Thyrocare has done 30,000 tests so far - mentioned in the q4 result. So they are doing 500 tests per day - apparently they can’t do more than 500 per day because of the lack of physical infrastructure dedicated to microbiology tests in their lab - hopefully they will rectify this issue to allow for more testing.
Covid test is a simple pcr test, it is either positive or negative - all test kits are approved by ICMR. So there should not be any major issues. I am not sure of the % of false positives for this test
Apparently what they do is they mix/pool 4 samples into 1 and test it as one sample - if negative all 4 samples are reported as negative. But, if the test is positive all 4 samples are tested again individually to determine the positive sample. Vast majority of covid tests are negative and this is a clever way of reducing the cost.
Not sure why this post was flagged - I did not offend anyone. I was just trying to highlight the corruption in the govt system
Are the government labs to be believed in covid testing? really?? Govt labs have sub-standard lab processing systems - sub-optimally trained staff and with no real leadership in lab testing (I mean it - no one cares about laboratory or their personnel in the Indian medical world)…copy pasted below is from an article…
Most experts believe that problems with sample collection are the main culprit behind inaccurate testing. False negative results are likely occurring because health care providers aren’t collecting samples with enough of the virus for the tests to detect.
This can happen because someone doesn’t insert a swab deep enough in the nose or doesn’t collect enough of the sample. False negatives could occur if a person is tested too early or too late during their infection and there isn’t a lot of virus in their cells. And finally, errors can happen if a sample sits too long before being tested, which allows the viral RNA to break down.
This relatively high risk of false negatives is why doctors don’t just rely on a test to determine if a person has the coronavirus. If a person presents with classic symptoms of COVID-19 and is in an area with an outbreak, doctors will often diagnose a person with the disease is spite of a negative test.
The PnL doesn’t give a good picture of how FY20 was
The YoY PAT growth looks negligible.
The main culprit being the Nueclear write-off of ~44 Cr, expensed through the PnL in standalone and ~6Cr in consolidated (Goodwill impairment) which has made them show losses for the quarter to the tune of 18 Cr.
There is a corresponding reduction in PP&E in the balance sheet to what was expensed
This is pretty clean accounting IMHO. I wish businesses were this transparent in their dealings making for very readable statements without obfuscation.
The Cash-Flow statements show the true picture of how the business performed in the year.
The Cash-flow from Operations (CFO) shows 167 Cr which is pretty good (compared to 147 Cr EBITDA and 89 Cr PAT in the consolidated PnL and compared to 100 Cr CFO last year)
The company has paid out dividend (Rs.20 in Aug and Rs.5 in Nov on 5.3 Cr shares outstanding) to the tune of 132 Cr in this. At current mcap of Rs.2800 Cr, that’s a dividend yield of about 4.7% (Screener number seems to show 0.94% which doesn’t look right).
The company has given some sort of how its impacted by Covid-19 in its Notes to Accounts.
Although functional, the capacities operational appear to be lowered and that can be bad temporarily for a company like Thyrocare which thrives on volumes. The operating leverage will play negatively in the short-term in Q1. I don’t think someone like Velumani will let go of his employees or downsize when faced with temporary headwinds, so expect a hit to the PnL in Q1 and probably even Q2 FY21.
Disc: Invested
The reason is clear that they want to hide or slow down the transparent reporting of positive cases. There is no doubt that escalating cases is creating fear among masses and the best way to slow down these numbers is to shut efficient players like thyro and metropolis. We might be sleepwalking into panic situation for middle And rich class. Till now they have been sitting pretty at home as they could afford to. Private diagnostics was the only hope for folks like us.
Dr V mentioned in one of the above news piece that Govt officials don’t understand science!! No surprises there…and these people who don’t understand science take decisions regarding medical matters for the people of our country
Metropolis boss Ameera S said that some reports were not able to be released “within 24 hours” due to staff shortage! Wow, she expects super high standards from her lab…I know that in many advanced countries the turnaround time for the report is 1-3 days! This swab test is not easy to do and positive tests go through confirmatory tests again.
Positive tests are a priority (since the clinician and the patient should be aware of this result asap) and negative tests are not so…Lab processes and protocols are not the same in labs and there is no guideline from the government…
I also hear from some of my physician colleagues in Mumbai that there are many cases where suspicion of covid disease is high but the swab test is negative!! The most likely explanation for this is sub-optimal sampling from the nasal/oral cavity ( in other words lab technicians who are poorly or not sufficiently trained are doing these tests in stressful environment leading to false negative tests)!!
As I alluded to in my earlier post, Thyrocare has started Covid blood antibody testing - this will be a much bigger opportunity than nasal swab PCR testing and Govt control will not be there (since it is a not a diagnostic/essential test - it indicates past infection if positive)…
But this is not for diagnosis. It is theoretically only for screening so can’t be a mass test yet.
They have already done 10,000 tests since 26 June! Rs 600 per test - assume 25% profit margin after tax/expenses (this is just my guesstimate)
This test is a simple blood test and PPE is not required to collect the blood sample…They could collect the blood sample anywhere in the country - all they need is a phlebotomist to collect the blood sample and transport the specimen to either regional labs or central lab
Why do we do covid antibody test?
The test is done to know whether the person has been infected with covid in the past (positive test) or not (negative test)especially in patients who did not have the nasal PCR test when they were unwell with respiratory symptoms.
Positive covid antibody test
If positive it indicates that the person has been infected with covid in the past
He will be immune to re-infection with covid (how long this immunity will last is uncertain at this stage)
Workplaces will be able to allow such people with positive antibody test to start working again in their premises, offices, hospitals, clinics, pharmacies, nursing homes etc with the confidence that the person will not transmit covid to others…
Overseas travel - countries might insist on covid antibody testing prior to approving visa for overseas travel
Negative test
The person has not been infected in the past and he is prone for covid infection and if he gets infected with covid the person is likely to transmit to close contacts
Workplaces may not allow their staff to resume work at their premises
Covid antibody testing is a much bigger opportunity than covid nasal PCR test. You read it here first
Discl - invested and biased
