Shares of diagnostic firms like Dr Lal PathLabs Ltd., Thyrocare Technologies Ltd., and Metropolis Healthcare Ltd. jumped between 6-11 percent on Wednesday as Covid-19 fears loomed again with a rising number of cases globally.

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Union Health Minister Mansukh Mandaviya held a meeting with senior officials on Wednesday to review the Covid-19 situation in India as cases surge in China, Japan, South Korea, Brazil, and also the US.

Head of the Covid-19 taskforce VK Paul said that Covid is not over but citizens do not need to panic and that the government has the capacity and experience to deal with this pandemic. Paul's words were also echoed by the Health minister who has directed all to be alert and increase surveillance.

However, diagnostic firms maintained that Covid-19 testing is “insignificant” as of now and there has been no change in curve.

Unless there are hospitalisations or severity in Covid-19 cases, lab firms are not expecting the testing to rise. Even if there is a rise in testing, competition is likely to weigh on the Covid-19 testing volumes.

During the quarter ended September 2022, Dr. Lal Pathlabs reported a 91 percent decline in its Covid-19 testing revenue to Rs 21 crore compared with a year ago. For Metropolis, Covid-19 PCR testing revenue fell 84 percent year-on-year to Rs 7 crore during the second quarter, while Thyrocare’s was down 97 percent to Rs 2.06 crore.

Even after a substantial correction, the valuation of these diagnostic companies are still at elevated levels.

For Thyrocare, this is the best single-day performance in nearly a year. Metropolis Healthcare had its best single-day gain in over eight months. Dr Lal's gains on Wednesday were also the most in a single day for the company since March this year.

First Published:Dec 21, 2022 3:11 PM IST