Healthcare Stock Okays 2nd Interim Dividend of Rs 12/Share: Buy?

During Wednesday's closing session, Dr. Lal PathLabs Ltd., a large-cap healthcare firm, registered a market worth of Rs 20,785.99 Cr. Dr Lal PathLabs is a leading blood test laboratory in India that provides a variety of diagnostic tests and diagnostic services. The financial results for the December 2023 quarter have been released by the stock, coupled with the announcement of a second interim dividend of 120% on a face value of Rs 10/-per share for FY24.

Dr. Lal PathLabs Dividend

The Board of Directors have declared "Payment of 2nd Interim Dividend of INR 12/- per equity share (@ 120% on a face value of INR 10/- per share) for the FY 2023-24. The record date for the purpose of payment of 2nd Interim Dividend shall be February 13, 2024," said the company in a stock exchange filing.

"The Board of Directors of the Company had approved first Interim dividend of Rs. 6 per equity share (face value of INR 10 each) at their meeting held on 27 July, 2023 and this was paid on 23 August, 2023. The Board of Directors of the Company had proposed final dividend or Rs. 6 per equity share (face value of INR 10 each) for the financial year ended 31 March, 2023. The same was approved by the shareholders In the Annual General Meeting held on 12 September, 2023 and this was paid on 15 September, 2023," said Dr. Lal PathLabs in a statement.

Dr. Lal PathLabs Financials

The company reported revenue from operations of Rs 539 Cr during the quarter ended December 31, 2023 up by 10.10% YoY from Rs 489 Cr in the year-ago quarter. Its EBITDA reached Rs 141 Cr during the quarter under review up by 24.6% YoY from Rs 113 Cr in the same quarter of the previous fiscal. The company posted a net profit of Rs 82 Cr in Q3FY24 up by 53.3% YoY from Rs 54 Cr in Q3FY23.

Dr. Lal PathLabs Share Price Target

Mandar Bhojane - Equity Research Analyst at Choice Broking said Lal Path Labs, presently trading at Rs 2506, demonstrates resilience despite a minor pullback, suggesting a healthy correction in the stock. The company maintains a position above crucial moving averages, including the 50-day and 100-day Exponential Moving Averages (EMAs), indicating promising potential for further upward movement, with a targeted peak at Rs 2700/2800.
The stock has a support zone near Rs 2300-2270 on the downside, where it remains above critical Exponential Moving Averages, including the 200-day EMAs, further strengthening its technical outlook.

In terms of risk management, market participants are advised to set a stop-loss at Rs 2250 to safeguard their investments. A strategic approach involves actively seeking buying opportunities during market dips, thereby enhancing the potential for optimal entry points.

Lal Path Labs emerges as a promising buying prospect. With a target price set at Rs 2700/2800, contingent upon prudent risk management measures, this stock presents an attractive proposition for investors seeking potential gains in the current market environment.

Disclaimer

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