The Hindu Business Line : Vimta Lab: Betting on clinical reference

The counter of Vimta Labs has seen almost a 26-per cent appreciation month on month, on the BSE with the stock ending at Rs 198.25 at the bourse on Friday. The counter has gained around 4 per cent plus over the past week.

Marketmen maintain that interest in this stock is being driven purely in anticipation of strong volume growth in the clinical reference lab (CRL) business. Revenues are expected to grow at a CAGR of 45 per cent in the period FY06-08. Earnings too are expected to grow in excess of 50 per cent in FY07 and 40 per cent in FY08.

According to an analyst with a leading domestic brokerage, Vimta has set up around 639 franchises to collect samples and is looking to further expand its network. The CRL business is expected to contribute to about 30 per cent to the topline in FY-08 as against 12 per cent in FY-06. With its facility at S.P.Biotech park expected to go on stream in FY-07, it will provide the required facility to grow volume for the CRL business as well the increased capacity to grow the contract research business.

Vimta Labs provides contract research and testing services in the area of clinical research, pre-clinical (animal) studies, clinical reference lab services, environmental assessments and analytical assessments of a wide variety of products.

Deeptha Rajkumar

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