Metropolis Healthcare Limited (NSE: METROPOLIS) Q1 2026 Earnings Call dated Aug. 08, 2025
Corporate Participants:
Unidentified Speaker
Ameera Shah — Managing Director
Surendran Chemmenkotil — Managing Director
Sameer Patel — Chief Financial Officer
Analysts:
Unidentified Participant
Amey Chalke — Analyst
Tausif Shaikh — Analyst
Sumit Gupta — Analyst
Kunal Thanvi — Analyst
Raman KV — Analyst
Girish Bakhru — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q1FY26 earnings conference call of Metropolis Healthcare Limited hosted by JM Financial. This conference call may contain forward looking statements about the company which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements do not guarantee the future performance of the company and it may involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes.
Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchtone phone. Please note that this conference is being recorded with this. I now hand the conference over to Mr. Amed Salki from JM Financial. Thank you. And over to you sir.
Amey Chalke — Analyst
Yes, thank you Shruti. Good morning everyone. I am on behalf of CM Financial welcome you all to the 1QFY26 earnings conference call of Metropolis Healthcare. From Metropolis we have with us today Ms. Ameera Shah, Chairman and Whole Time Director, Mr. Surendra, Managing Director and Chief Executive Officer, Mr. Samir Patel, Chief Financial Officer and Mr. Audu Joshi, Chief Business Development Officer. Now I will hand over the call line to you Ma’, am, over to you for your opening remarks.
Ameera Shah — Managing Director
Thank you Amay and good morning everyone and thank you for joining us today for the Q1 FY26 earnings conference call. We’ve uploaded our investor presentation and the related documents on the stock exchanges and the company’s website and I hope everyone’s had the opportunity to go through the same. India’s healthcare landscape is gradually shifting shaped by a range of developments in how care is delivered, accessed and monitored. We are keeping an eye on a few broad global trends that stand out. AI led diagnostics, decentralized point of care testing and the growing relevance of GLP1 therapies and metabolic health.
Artificial intelligence is increasingly being embedded into diagnostic workflows particularly in radiology, enabling faster, more accurate reporting and personalized recommendations in the pathology space. Globally or in India, it has started entering the workspace in customer service, back end processes and a few technical tests. However, it is far from being used en masse at this time. At Metropolis we’re applying AI across multiple areas from clinical reporting in a few tests and customer chatbots to text test, recommendation engine and AI assisted testing in prostate cancer, allergy testing and karyotyping. No one in India at this time is using AI in a very scaled or differentiated way that we believe is going to be severely disruptive to the existing industry.
The second trend when we review which is of POC diagnostics, we are seeing it help improve access, especially in semi urban and rural areas where setting up a lab may not make economic sense. Point of care is not cheaper or more accurate than the current standardized platform and therefore usage is more for urgent reporting in metros and access to diagnostics in smaller rural markets. If a scaled use case for using point of care diagnostics is found, Metropolis would certainly consider using this channel to access new customers or markets. On the GLP1 front, the receptor agonist market in India is currently valued at USD 110 million 2024 and projected to grow to 500 million by 2030.
This shift is likely to drive higher demand for regular monitoring of glucose, lipid, liver, kidney and cardiac parameters. This marks a shift from episodic testing to longitudinal health tracking, with consumers increasingly investing in proactive wellness. Together, these trends point to a gradual move towards more personalized and proactive diagnostics. Also, certain metabolic panels and other tests need increase as the use of GLP adoption increases. We are very happy to announce that our strategy of strong organic growth plus good quality acquisitions has resulted in 23% growth in revenues for MHL in Quarter 1 FY26. Despite Q1 typically being a soft quarter in the west and south regions, Metropolis recorded a strong 13.2% organic growth in revenues driven by volumes and improved realizations supported by our strong brand equity and expertise in the specialty diagnostic segment.
With north region now contributing 17% to our overall revenue, we will continue to spend considerable time and effort in growing this base in the Northern region. While quality scale and brand equity continue to be strong pillars, we are now doubling down on our scientific depth and innovation to further further distinguish ourselves from competition, particularly in a market where pricing gaps are narrowing. We are in the process of building a Center of Excellence in Oncology Diagnostics which will centralize expertise in genomics, histopathology, cytogenetics, molecular oncology and precision testing. The center of Excellence will serve as a hub for clinical collaboration, research and education, positioning Metropolis as a leader in onco diagnostics and enabling differentiated high trust offerings for oncologists and hospitals.
The acquisition of CORE and putting together skills and expertise Metropolis already had in oncology, along with the new relationships acquired by core, we will create a platform for Metropolis to not only be the largest oncology testing player in the country, but keep innovating and investing for growth for the next several years to come. Additionally, we have been actively upgrading our labs and associated IT systems while complementing and implementing several lab automation initiatives to boost efficiency and productivity. As we keep increasing our test menu not only in our global reference lab but also in our regional reference labs, it allows us to deliver faster results and reduce turnaround time for our specialty tests for all markets.
But fast is not enough. The result has to be precise and accurate according to each doctor’s individual experience. To achieve this, we not only have curated our own quality protocols, but we have standardized them across all our labs and continue to uphold and show our quality results in every test for every patient and every doctor. Our rigorous internal quality control process operates in parallel to NABL accreditation and is rolled out across every lab under Metropolis. This doesn’t mean just testing the sample on a single machine transferring the data to the patient, but it includes multi tier validation of test results using various testing platforms to cross check results, curation of reference ranges for the Indian patient, daily quality checks, and the use of Google quality controls and standards ensuring consistency, accuracy and reliability across our entire lab network.
This system provides a significant edge over not just unorganized players where such uniformity is often lacking, but also sometimes organized players where our expertise and knowledge of pathology over 40 years proves to be a differentiator. Just to update you on the integration of our recently acquired targets, last quarter we completed three acquisitions as part of our inorganic growth strategy. The integration of these assets is progressing smoothly with no significant challenges encountered. Led by a dedicated steering committee, the integration process is already yielding synergies, particularly in lab consolidation, procurement efficiencies and reduction of overlapping overheads. Our immediate focus is to fully integrate these acquisitions into the Metropolis ecosystem, prioritizing operational efficiency and margin improvement in the first year.
Once integration is complete and synergies are captured, we will shift our focus to accelerating revenue growth through cross selling opportunities and expanding the reach of core diagnostics across Metropolis. Pan India network in year two. While Metropolis has organically posted a 24.7% EBITDA margin and Scientific Pathology and DAPIC in Dehradun are of good margin profile, Core Diagnostics will be turned around this year and this year it will drag the consolidated EBITDA marginally. If we look at core, CORE has shown a positive year on year revenue growth with a notable improvement in profitability, achieving a low single digit EBITDA margin compared to the breakeven levels in Q4FY25 before we acquired it.
Our immediate goal is to integrate the team into our culture and processes while unlocking efficiency gains through integration synergies. Our goal for year one is to reach a high single episode EBITDA margin primarily through cost synergies and we should see the progress over the coming quarters. Pat for Q1 is negative largely due to high depreciation and high cost interest for coal and IT has a 12 crore loan in the books which has been now refinanced in July at a much better rate and hence Q2. Pat for coal should be much better. Scientific Pathology Agra and Dapik Dehradun, both entities have delivered revenue growth in line with the company average and margins are slightly above the company average for both.
These brands are well established in their respective local markets and our strategy moving forward is to expand into adjacent regions by increasing the number of collection centers and offering the broader Metropolis test menu helping us capture a larger share of the market. It’s worth noting that Dapik Dehradun has been consolidated only from 23 May 2025 and scientific pathology Agra only from 16 June 2025 and hence only proportionate revenue and margins have been consolidated in Q1. Just yesterday we have announced our acquisition of Ambika Diagnostics in Kolhapur, founded and run by Dr. Patil and considered the most credible lab in Kolhapur.
We have been in a management contract with Ambika for the past two years where Metropolis runs the business with employees on our payroll and all processes and technology under the Metropolis guidelines. This lab on lease model has done very well the last two years and has grown 60% since we started managing it. We believe this growth will continue to be strong in the future and we thought it made sense to acquire this business and merge it with the Metropolis Kolhpur lab that runs independently in the city. While the revenue of the business was 8 crores in FY25 with 1.8 crore EBITDA.
When we look at the valuation of 17 crores for 100% of this business, it will actually while it looks like a 9.4 multiple of FY25 EBITDA, in reality the EBITDA will be 3.4 crores once we acquire it because it will include the synergies between the labs and fully show the profit on its own which would actually effectively be a 5x multiple of EBITDA. Together the labs, when we merge them would create the largest lab in Kolhapur in the whole region and it would be a good hub to grow in the whole district. Dr. Patil will continue to work with us for over 10 years and we believe this acquisition to be highly accretive.
From day one, the acquisition would be done from internal accruals and closed within the 30 days from signing which was yesterday. We have consistently emphasized our strategic intent to diversify into adjacent healthcare services which can enhance customer engagement and we have been piloting several initiatives including basic radiology like ECG and X ray and non blood vital checkups and on call doctor consultations. We are pleased to share that our basic radiology pilot has gained encouraging traction. We have 20 locations offering full radiology services which include X ray, Sonography and ECG, 36 locations offering X ray services and 240 locations offering ECG services across the Metropolis network.
The integrated approach which combines blood diagnostics, non blood vital assessment and basic radiology enables us to offer a more comprehensive and holistic preventive health solution under the True Health brand. By expanding these services within the Metropolis ecosystem, we are not only enhancing customer value, but we are strengthening our ability to deliver end to end health screening packages and this is helping us improve our RPP as well. Early indicators from these pilots are promising and we believe this direction has the potential to serve as an additional growth lever, further deepening customer engagement and expanding our service function footprint.
Lastly, on the competitive front, the landscape remains largely unchanged. The unorganized sector continues to lose market share to organized players and the growth is largely through marginal volume increase. The unorganized guys this shift in market share was initially concentrated amongst a few organized players pre Covid and post Covid. The same is now distributed across a slightly larger number of organized players players. Meanwhile, in the last 12 to 18 months, health tech players are facing heat on lower growth and trying to demonstrate that their unit economics work. In response, they have been consistently raising prices and are now transitioning from discount led volume growth to a value based growth approach bringing their revenue growth similar to organized players.
We continue to remain excited for Metropolis revenue and profit growth for this year. While we will spend most of our energy on growing the business organically and integrating the deals already announced, we will continue to evaluate other acquisitions that make sense for Metropolis for the future, always from the goal of buying businesses which fit our culture long term vision and can create financial value for shareholders. I’ll now ask Sureen to brief you on the progress on key operational and financial metrics. Thanks Sureen. Over to
Surendran Chemmenkotil — Managing Director
thank you Amira and good morning everyone. So we are pleased to report that both patient volumes and the revenue growth have returned to normalized levels in line with our guidance. After a temporary dip observed in quarter four last year, largely due to seasonal and regional factors, the business has rebounded as expected in the quarter one. The recovery has been broad based supported by several strategic growth levers. Let me just deep dive into some of them. True Health Preventive Portfolio Our True Health range of preventive health checkups continues to be key contributor to patient footfall and test volume growth.
With increasing awareness around preventive diagnostic, lifestyle management and chronic disease monitoring and our ability to upsell truhealth is witnessing healthier adoption across urban and rural markets. Our integrated approach of blood diagnostic, non blood vital checks and doctor consultation is helping us and we have now reached 18 percentage contribution via true Health Portfolio. Growth in high end specialty tests, particularly in oncology and genomics have added both volume and value to our overall portfolio. These tests not only command higher RPP but also reinforce Metropolis positioning as a science led differentiated diagnostic provider. On the network expansion side, continued geographic expansion especially in underserved tier 3 and peri urban markets has been strong tailwind.
Through a focused hub and spoke model, we have added new collection centers enhancing access and brand presence across newer micro markets. The tier 3 cities have shown strong growth in patient volume driven by increasing brand preference, widening test menu availability and improved local infrastructure. Starting this quarter we have reclassified our B2C and B2B portfolios to align with prevailing industry standards. To make it easier for investors and analysts to compare, we have dropped the institutional bucket completely and divided the business under only B2B and B2C. Under the revised classification, B2C now includes all revenues from company owned centers, franchisee centers and rural collection centers.
B2B encompasses service to laboratories, hospitals, government institutions, corporates and pharma companies. As per the Revised definition of B2C, our organic business B2C revenue contribution stood at 59% as compared to 57.8% in quarter one last year. For MHL Group, B2C now contributes 56 percentage to overall revenues including the acquisitions. The decrease in B2C contribution on group level is largely on account of Core Diagnostics which has majority of revenue contribution from B2B channels going forward. With cross selling of the specialty test across Metropolis Network and leveraging the existing channels, we believe that contribution of B2C share from Core should increase.
Our organic B2C business continue to show robust and consistent growth with revenues increasing by 16% on a year on year basis. Now this is driven by 9 percentage growth in patient volumes reflecting strong consumer engagement and reach 6 percentage growth from improved test mix and pricing highlighting our ability to offer differentiated and value added diagnostic services. In Maharashtra which is our largest B2C market revenues also grew by 16% year on year with Mumbai outperforming the state average, fueled by deeper brand equity, broader test offerings and strong medical community trust. Our strategic push into Tier 2 and Tier 3 towns is further strengthening our B2C footprint, helping us reach new patients through an expanding network of collection centers and franchisee partners.
A key enabler of B2C growth has been the increased adoption and engagement of our mobile and digital platforms including the Metropolis apps. Key enhancements that are driving stickiness and repeat usage include personalized health journeys, tailored test suggestions and curated wellness content based on patient history and preferences. Real time tracking of orders, seamless report access and proactive health reminders. Significantly improving customer satisfaction. End to end digital integration of test booking, home sample collections, payments and customer support resulting in smooth and hassle free experience. This omnichannel approach is not only enhancing patient convenience but also improving operational efficiency by reducing dependency on manual channels and lowering service turnaround times.
At the local level. Our micro marketing strategy is helping us drive targeted awareness and patient acquisition in high potential clusters. This includes hyperlocal campaigns based on regional health trends and demographic insights. Clinician engagement programs to build strong relationship with the medical community. Expansion of partner program which has made the relationship between franchisee and Metropolis even stronger. These initiatives have led to a visible increase in B2C contribution, stronger brand recall and improved penetration in both metro and non metro markets. We remain confident that this momentum will continue to build as we scale our reach, optimize our best offerings and deepen customer relationships.
Our B2B revenue for the quarter grew by 10% and now stands at 41% as per the revised classification of the B2B definition for the organic business. Patient volume in B2B segment grew by 4% while RPP rose 6 percentage, primarily driven by high value outsourcing from hospitals. This reflects our continued focus on specialized and advanced diagnostic offerings that command better pricing. We increased our partnership with the pharmaceutical companies in line with our strategic emphasis on specialty diagnostics. Upgrades to our partner portal have improved end to end visibility and Service experience for B2B clients. Enhanced tracking, transparent reporting and faster resolution mechanisms have significantly improved partner satisfaction and operational efficiency across labs, hospitals and corporate accounts.
This quarter we also concluded our engagement with AAM Aartani Mola Clinic in line with our long term strategy to move away from low margin government or institutional contracts. Instead we are focusing on Science led B2C and B2B segments which offer higher margins and greater long term sustainability. Turning to the productivity and margin performance, the EBITDA margins for quarter one stood at 24.7% higher than quarter four last year. Our attempt will be to strengthen the margin every quarter for this year on a year on year basis. The reported group EBITDA as marginally impacted by the consolidation of core diagnostics which is currently operating at low single digit margins.
While it’s an improvement from breakeven levels of quarter four last year before we acquired the business, we remain hopeful of bringing course margin profile to high single digit by the end of the financial year as integration progresses and synergies begin to reflect the financials. To strengthen EBITDA margin this year in the next few quarters we have rolled out multiple productivity initiatives aimed at unlocking efficiencies. Over the last 18 to 24 months we had invested heavily in automation and digital workflows to streamline operations, reduce manual effort and enhance service turnaround times. Many of these programs are now live and will start to add to our productivity efforts.
Also, our lab infrastructure expansion which is in execution for the last four years successfully concluded last quarter. With this foundation in place, our focus has now shifted to rapidly scaling our collection center network to feed these labs, thereby driving higher throughput and utilization which will translate into better margins over time. In quarter one we have added 80 new collection centers and we are on track to add approximately 400 plus collection centers across various regions this year with a strong focus on tier 2 and tier 3 towns. This expansion is being supported by our recently strengthened lab infrastructure in these geographies.
As of now we are serving Customers in about 750 towns across India and we aim to expand our footprint to 1000 towns soon, further deepening access and enhancing our presence in high growth under penetrated markets. So in summary, we have entered financially at 26 with renewed momentum clearly shifting gears compared to the previous two quarters. The integration of recent acquisition is well on track and we expect this to unlock meaningful cost synergies over the remainder of the year. This includes operational consolidation, procurement efficiencies and overhead optimization, all of which will contribute positively to our margin profile.
On the growth front, we are seeing healthy revenue performance supported by strong execution across core growth drivers. The true health preventive portfolio, specialty diagnostics and tier 3 market expansion continue to be the leading contributors. These segments not only add scale but also bring higher value and margin attractive business. Aligning with our strategy of moving towards quality led growth, we have also deepened our focus in science and quality, an important pillar of differentiation for Metropolis. This includes enhancement in quality processes, test menu expansion, step towards building center of excellence and continuous upscaling through scientific platforms. These actions position us as a trusted diagnostic partner, especially in the specialty and high end testing space.
In parallel, we have activated several productivity enablers across the organization from digital process automation to optimize resource deployment. These efforts are already yielding improvements in operational efficiency and are expected to support sustained margin expansion going forward. Overall, with strong execution across integration, science, digital and operational fronts, we are entering the year with solid traction and clear line of sight to our goals. We remain committed to delivering profitable sustainable growth with reinforcing Metropolis position as trusted science led diagnostic leader. With this now I hand over the call to Sameer who will take us through the financial highlights.
Thank you and over to you.
Sameer Patel — Chief Financial Officer
Thank you Sven and good morning everyone. Let me now share some of the key financial performance for Q1FY26. We have bifurcated our reporting on two aspects one MHL Group and second MHL Organic. MHL Group includes recent three acquisitions of CO Diagnostic Depic, Dehradun and Scientific Pathology. ABERA NMHL organic excludes these three acquisitions. Also change in definition of B2C and B2B segment to streamline the same with the industry standards. B2C now includes all owned, franchisee and rural centers and B2B now includes B2B lab, hospitals, government, corporate and clinical trials. Moving on to the financial performance and operational performance, first I would like to highlight operational performance of MHL on organic basis.
Revenue and EBITDA grew by 13.2% and 11.9% respectively and PAT grew by 21.2% on year on year basis patient volume stood at 3.2 million, a growth of 7%. Our test volume growth stood at 8% on year on year basis with increased contribution from two health segments. We consider one profile as one test which is different from peers as on like to like basis. As peers this number would be a Significantly higher. Our B2C revenue stood at Rupees 209 crores, a growth of 16% on year on year basis and B2B revenue stood at 10%. True Health and Specialty segment grew by 22% and 16% respectively.
As the revised classification of B2C segment, B2C contributes 59% of total revenue compared to 57.8% in Q1FY25. Revenue for Specialty, B2C segment grew by 18% and B2C True Health segment grew by 19% on year on year basis. B2B revenue stood at 14% of total revenue and B2B Specialty grew by 15%. 2 Health segment for Q1FY26 grew by 22% and 2 Health now contributes at 18% of overall revenue. Specialty segment grew by 16% on year on year basis for Q1FY26. EBITDA for MHL on organic basis stood at 87.5 crore, a growth of 11.9% on year on year basis.
EBITDA margin for MHL organic stood at 24.7, an increase of 40 basis points on a sequential basis and we are optimistic of seeing an uptrend every quarter. PAT for MHL on organic basis stood at 46.2 crore as compared to 38.1 crore in Q1FY25 a growth of 21.2%. PAT margin for MHL Organic stood at 13% compared to 12.2% in Q1FY25, an increase of 80 basis points. Now let me share the key performance indicators for MHL at a group level revenue grew by 23.2% on year on year basis from amateur group including the revenue of recent acquired entities.
PET volume stood at 3.4 million and test volume stood at 7.1 million, a growth of 11 and 12% respectively. B2C business revenue grew by 19% for Q1FY26 and B2B revenue grew by 29% on year on year basis on MHL group basis. Revenue for the north now contributes 17% of overall revenue largely because of integration of CO diagnostic which has its major presence and revenue coming from north region. Revenue growth from tier 1 town stood at 27% and tier 3 towns stood at 17% on a year on year basis. Revenue for tier 3 town now contributes 17% of the total revenue for Q1FY26 contribution from B2C revenue stood at 56% in Q1FY26.
The decrease in B2C compared to organic business of 59% is largely on account of consolidation of co diagnostic which has major majority of revenue contribution coming from B2B. EBITDA margin for MHL group stood at 23.1%. The decrease was largely attributed to lower margin profile of Core Diagnostics. However, we are happy to report that core has turned positive with a lower single digit margin profile in Q1FY26. PAT for MHL Group stood at 45.2 crore. This PAT is at 11.7%. That’s all from my side. With this I open the floor for question and answer.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their Touchstone telephone. If you wish to remove yourself from the question queue, you may press star. And two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Anshul Agarwal from mk. Please go ahead.
Unidentified Participant
Hope I’m audible.
Surendran Chemmenkotil
Yeah, please go ahead.
operator
Yes, you’re audible.
Unidentified Participant
Great. So my first question is on integrated offerings. While our pilot projects have indicated positive traction in basic radiology, what would be our plan going forward? Would we sort of think about getting into advanced radiology or continue to expand basic radiology across our network? And secondly, would this be on an asset light basis or would we own these equipments?
Ameera Shah
So I think on the basic radiology we’ll continue to spread it across our centers. And these equipments are not very expensive. These are smaller equipments. A lot of them are on asset light basis. We are not procuring all of them. It’s a combination, I would say, you know, we are evaluating whether higher end radiology is something worth getting into or not. We don’t have a clear answer at this point of time. I think over the next couple of quarters I think we’ll have a clearer direction. But meantime we’ll continue to roll out the basic radiology.
Where we are finding this is helping, it’s not helping obviously very significantly on the independent revenue front. But what we are finding is that customer frequency to our centers increases with it. And when they do add on some of these tests, either radiology or the non blood vitals, it actually helps them do a larger screening program, wellness screening program with us. So it’s more about the completion of the services at the center, which also helps in NPS with the customer.
Unidentified Participant
Second question is on GLP medication, from what we understand Amira here, would patients or would customers start becoming healthier by using this medication? Is that a risk for the healthcare delivery providers? How should we look at it? I understand this is a very nascent stage, but why do you view this in positive light versus versus what the product is destined to deliver?
Ameera Shah
See, the product is only talking about weight loss. The product is not necessarily saying better health. These are not necessarily the same thing. They can be for somebody who’s got obesity as an issue. Obviously automatically it brings about diabetes and other things. But you also have to remember anytime you’re giving a dosage of a drug, there also can be side effects that are known side effects of these drugs. And therefore doctors who are prescribing them will also have to continue to Monitor those patients to watch out for whether those side effects are taking place in the patient’s body or not.
So our sense is that while it has a potential to manage, maybe diabetes better because of obesity coming down, but things like cardiovascular risk and other risk which could be caused because of these GLP1 medications will continue to have to be monitored. And it’s not just the heart, but also watching the liver, the kidney and to see if there’s any impact there. We have to remember that these drugs are not that old in the world and people have not had a chance to really see what is the impact of these for the next 10, 15 years.
So I sense that people will continue to monitor their health because one of the things they are doing to take GLP1 is to get healthier. And that automatically means also that you want to a more regular wellness screening to make sure that all parts of your body are working fine.
Unidentified Participant
That’s clear. Just one more if I can squeeze in in terms of our margin profile, I’m talking about the organic, the business excluding the acquisitions. When do we start seeing the benefits of the hub expansion that we took over the last two to three years to sort of creep in our margins? Should we not expect margin expansion of 100, 150bps on our organic business?
Surendran Chemmenkotil
All right, Anshul, we have mentioned this in the past also that, you know, the drag on the margin from the newly acquired labs actually happens for two years. Actually first year it normally get into a negative margins and the year two it gets into a positive 1012 percentage margin and the year three normally gets into the company levels of margin. So we have anyway halted all the accelerated expansions last year, I mean at the end of quarter four. So this year for the labs that we expanded last year and the year prior to that, there will be some little bit of drag on that and the next year we will have a little bit of drag on because of the labs we expanded the previous year.
So you’ll start seeing benefits on, you know, EBITDA margins coming this year to start with and next year, by the end of next year we will get the full benefit of the lab expansion which has been halted. So I think it’s a couple of years time where you fully get that 1 percentage plus benefit which otherwise we used to talk about.
Ameera Shah
But compared to last year obviously in 25, 26, we will certainly see a margin bump. EBITDA expansion we’ve already, you’ll start seeing it obviously from Q2 itself.
Unidentified Participant
Great. Those were my questions all the very Best.
Surendran Chemmenkotil
Thank you. Thank you.
operator
Thank you. A reminder to all participants, anyone who wishes to ask a question may press star and one on their touchstone telephone. Our next question is from the line of Tosif Sheikh from BNP Paribas. Please go ahead.
Tausif Shaikh
Good morning. Thanks for the opportunity, ma’. Am. Well, you have mentioned the initial comments that CO diagnostic have turned positive. Can you throw some light on the patient volume growth and the revenue growth which the CO diagnostic has visit seen on yoy basis.
Ameera Shah
So at this point we are not providing the separate information for each of these. But like we mentioned broadly in year one, what we traditionally see when you acquire any organization, whether it’s unorganized or organized, is that sometimes the practices in it may not be exactly the same as Metropolis. And therefore sometimes you have to cut certain customer accounts. You have to let certain things go because you want to clean things up. And therefore the first year the goal will be margin expansion and cleaning up the practices and integrating. And from year two the focus will really be on the revenue acceleration.
And that’s the direction that we are going in. It’s obviously just the first quarter of the acquisition and some of these acquisitions have only had 15 days off in the quarter. So we felt it’s just too early to start. Sort of giving indications on the separate growth and the separate margins for everything. The only reason we indicated for core is just to show the trajectory on what we committed when we did the acquisition that we will see a quarter to quarter improvement in the profit profile. And we just wanted to indicate that that’s on track.
Tausif Shaikh
That’s helpful, ma’. Am. Second question again on CO diagnostic at the time of the acquisition you had mentioned with a field first of 100 people have it in kind of any kind of restructuring to this field force?
Surendran Chemmenkotil
No, we have not disturbed the field force at this point of time. That’s continue to operate the way they used to operate because they are all specialist, specially specialist sales people. And we have not done any restructuring at this time stage.
Tausif Shaikh
Yeah, thanks that helpful.
operator
Thank you. Our next question is from the line of Sumit Gupta from Centrum. Please go ahead.
Sumit Gupta
Hi, good morning. Am I audible?
operator
Yes, sir. You audible?
Sumit Gupta
Yeah, hi. Yeah, so thanks for taking my question. So first is like. Like what’s the strategy for expanding into this Kodakur area? Like will it be acting as a. Like, I just want to understand.
operator
Sorry to interrupt. So mit. Sir, your voice got low and your audio break. Can you please repeat your question?
Sumit Gupta
Hello? Is it fine now?
operator
Yes, sir, now it’s fine.
Sumit Gupta
Please yeah. So just. Yeah. So want to understand on the basically rationale for expanding into Kolapur.
Surendran Chemmenkotil
So like Amira mentioned, this lab, you know, which is Ampica Diagnostics, used to be on a lab on Lebon Lee Lison lab with us in the past for last two years and where it has been run by our people right now we have decided to acquire this lab and we also have a metropolis separate lab in that area. So now with this acquisition, we need to have only one of the two labs in that place because it will be fully owned by us. And this will also help us to expand into the entire Kolapur region.
Right. And we already have presence in most part of the Kolapur region, but with, you know, the addition of ambiguity diagnostic will have a little more stronger footprint and good coverage across that area.
Sumit Gupta
Okay. So going forward, like can we expect more kind of more acquisitions of this particular size or we can expect a size to be bigger?
Ameera Shah
We’ll continue to. At this point we don’t have anything else that we are expecting to announce at least in the next quarter or so. But as we keep evaluating the funnel, we are obviously looking at different sizes. We are looking at small ones, but which are very credible. Like we did apic, like we did agra, like we have done Ambika. And we are looking at larger ones as well. But the final goal is not about small or big. The final goal is about whether it really fits the culture, whether it fits the way of thinking that Metropolis has, its strategy and most importantly, does it create value for, you know, our shareholders.
And we are only buying, doing deals where we feel that we are able to create that kind of value and not having to pay a crazy price when it becomes difficult to create value.
Sumit Gupta
Understood. Okay. And like just bookkeeping question how, what was the EBITDA for this Ambika in.
Ameera Shah
FY25, so standalone it was 1.8 crores on its own if you look at FY25. But you know, in the model of lab on lease, we were also sharing certain revenue share with the Ambika pathology, etc. So when it’s in our books, it will actually be 3.4 crores and not 1.8.
Sumit Gupta
Understood, thank you.
operator
Thank you. Our next question is from the line of Kunal Tanvi from Banyan Tree Advisory Private Limited. Please go ahead.
Kunal Thanvi
Hey, thanks for the opportunity and good morning. So my first question was on the competition. Like in our annual report we’ve talked about, you know, some easing out of competition on pricing. Also from the organized and unorganized place. So if you look at some of the data points like say gross margin for most all the listed players and the kind of acquisitions we have been doing in last 18 months or so, there are some signs from like, from an outside investor we can see there’s some ease out in terms of the competitive intensity. And the valuations also seems to have kind of normalized.
If you can, you know, throw some more light on how the organized and unorganized piece in terms of competition has behaved and what are the factors that have led to, you know, competition kind of, you know, abating in last 18 months, it would be really helpful.
Ameera Shah
See if you look at the period of 2020, it was as we all know, a black swan event. And in any black swan event you have lots of people who look at opportunities that are hot and try to jump. So that’s what really happened in healthcare and especially in diagnostics because there was so much COVID testing that needed to be done that you saw a bunch of new corporate players who sort of said this is an industry which is going to grow for a long time, let’s jump in. And you also saw obviously helps tech guys coming in.
The reality of our industry however, is that these black swan events which create large revenues in a short period is not a norm. And the norm of the industry is you really have to work on the ground building sample by sample, building it through brand trust and credibility and expertise. And I think as some of the players, some new and some old, are recognizing the challenges and actually building the business and the kind of moat there is, you are seeing in some cases people saying, okay, maybe this is not necessarily what we are cut out for.
You’re seeing a funding slowing down. In some cases you are seeing a funding winter because companies have not been able to show and prove unit economics that work profitability for them and therefore funding is not coming for them. So I think there are different reasons, but I think largely I think it all comes back to commercial. The understanding is that, look, the organic growth in the industry is about 8 to 10% and anything you want to do about that or even to reach there is going to take a lot of hard work and lot of patience and long term vision.
So generally we are seeing that there is a little bit more rationality on the pricing and we are seeing the kind of intensity we saw between between 2020 and 23 has certainly come down. The players have not gone anywhere. They are still in the market, they continue to compete, but we are not seeing irrationality, which is a good Thing for the industry.
Kunal Thanvi
Sure. And when we look at the gross margin for most of the listed players, we’ve seen stability or going up. So like is it to do with only the pricing? How do one look at. Or there’s some respite on the raw material side also because if at all these listed players are gaining market share.
Sameer Patel
Can you just repeat the question?
operator
Yes, breaking when you are speaking.
Kunal Thanvi
Sorry for that. So my question was when you look at the gross margins, right. They have seems to have stapled or stable down or they are improving for most of the listed players, is it entirely due to pricing rationality coming up or because the large guys have started seeing market share gains? So there’s a second order impact on the raw material procurement cost?
Surendran Chemmenkotil
Actually it’s a combination of multiple things actually. One, of course the price stability is definitely coming and become more predictable. That’s really helping us. And then lot of operational efficiencies are coming in because of automation, digitization, etc. Right. I mean, and then of course as the scale goes up, you know, the profitability gets better. So basically it’s a combination of all these three things put together and you will see it’s playing out for everyone, you know, as we go forward.
Kunal Thanvi
Sure. The last question that I had was on like when we are moving from, you know, top towns to tier 2, tier 3 towns, how do one look at the unit economics in those smaller towns? Because the scale at which we will be operating in, you know, top eight cities would be very different. When you’re going to those smaller towns, can one expect similar kind of unit economics in terms of, you know, throughput margins etc. On those smaller towns? How you think about it?
Surendran Chemmenkotil
Yeah. So see now our expansion into Tier 3 and beyond will only be with respect to centers, not with respect to lab. The last part of the expansion is already over. Right. So and these expansion of the centers are also happening on Tier 3 and beyond only through the franchisee route. So from a metropolis point of view, largely the investments are in terms of clinician engagement, logistics, etc. Which has been properly been stitched. So your unit economics will largely be at par with rest of the tier three towns. And we don’t really find any further stress on that going forward when we expand and actually we are going deeper into this, we already reached 750 towns and we already have currently mechanism to engage with the clinicians and you know, the logistic arrangements.
Now your question is only about going deeper and becoming, getting more volumes. So the unit economically get better, you know from these towns.
Kunal Thanvi
Okay, sure. Maybe one thing was on radiology, the basic radiology that we talked about are margins. Again, similar there as well compared to what we have in our core business.
Surendran Chemmenkotil
See, it’s too early days for us. In the last year or so we have expanded into, let’s Amira said 20 centers where we have both X ray and ultrasound and about 35 centers we won’t have X ray alone and 250 centers with ECG. So very early days to look at the margin profile of these business separately. But we are sure that it will only be adding to the overall profitability because it’s happening from the same centers. We are not set up extra centers for the same centers, same people. So there is no additional cost other than the processing cost in these cases.
So, you know, the margin should only be at par or better.
Kunal Thanvi
Okay, sure. Thank you so much and all the very best.
operator
Thank you. A reminder to all participants, anyone who wishes to ask a question may press star and one on the Touchstone telephone. Our next question is from the line of Ishpreet Kaur from Relax Capital. Please go ahead.
Unidentified Participant
Hi, I just wanted to check, is it possible to share the average revenue per test in B2C and B2B?
Ameera Shah
I don’t think we have it off the top of our head, but I think there would be a difference of approximately 20% or more. And we’ll come back to you maybe with some specifics. Yeah, we’ve written down the name in detail.
Unidentified Participant
And is it also possible to give a breakup of volume in patient and test in B2C and B2B?
Surendran Chemmenkotil
Already provided that. If you want me to call it out separately, I’ll just do that. Just give me a minute. On the B2C. I mean, let me talk about the organic business. The volume growth was 9 percentage and the realization growth was 6 percentage adding up to a total of 16 percentage revenue growth. And on B2B the volume growth is 4 percentage and realization is 6 percentage.
Unidentified Participant
Is it possible to mention the numbers in terms of volume, not the growth?
Surendran Chemmenkotil
Absolute numbers, absolute number on B2C and B2B? We’ll get back to you on that. Yeah, we can get back to you on that.
Unidentified Participant
Maybe as a practice, if it is possible to share it as a disclosure in the presentation. Just a request from our end.
Surendran Chemmenkotil
All right.
Unidentified Participant
Just wanted to understand on the B2C part, considering the current test and the setup and the geographical expansion that we have, what is the kind of level of share that we could see from the B2C part in the next three to five years.
Surendran Chemmenkotil
See our first target, you know, now at a group level to move into the 60 percentage plus levels, you know, we are at a group level. We are at 56 percentage. After all the reclassification and keeping the group together, we are at 56%. Our first target is to reach up to, you know, 60 percentage as we go.
Unidentified Participant
Right. And similarly on the radiology side which we started, do we see it as a significant revenue contribution in the next three to five years?
Ameera Shah
The basic radiology I don’t think will be a significant contribution from a revenue perspective. If of course we choose to go into high end radiology, that would be different. But just on the question you asked around the volume in term tests for B2C and B2B. For B2C I think it’s 37.9 lakh for Q1 FY26 and B2B is 32.8 lakhs.
Unidentified Participant
32.8 for B2B.
Ameera Shah
That’s right. Sure.
Unidentified Participant
Thank you so much.
operator
Thank you. Our next question is from the line of Raman KV from Sequent Investments. Please go ahead.
Raman KV
Hello, thank you for allowing me to ask question and congrats on your excellent result. So I just want to understand how. Much of the total revenue is from B2G. Can you give a ballpark figure?
Surendran Chemmenkotil
B2G? So it’s negligible. I must say it’s negligible. You know, less than a percentage if I can say. So. So I mean in the last few calls have already mentioned that we are gradually withdrawing from the non profitable. You know, government businesses and other contracts are also finding it difficult to get our monies. You know, we are withdrawing. The last one was Ahmadni Maula Clinic which we withdrawn from 30th of June. So you know, today the government business is very, very negligible. Actually
Raman KV
how much was it three years back, if you can.
Surendran Chemmenkotil
We had a big Naco, which is a big contract which is about 7 percentage revenue at that point of time. And then overall we had about 10 percentage. 10 percentage government revenue we had. You know, today it’s less than a percentage. You know, gradually and strategically we have withdrawn from these businesses.
Raman KV
Okay, so and my second question is the main growth for any player in diagnostic is with respect to the volumes. So can you give a guidance with respect to the volumes of, you know, just Metropolis? And upon that, how much growth are you expecting for the acquired entities and the recently acquired Ambika Diagnostics, can we expect it to grow 60, 60%? Because you as you mentioned earlier that it grew 60% this year in FY25. Can we expect it to repeat the same or not?
Surendran Chemmenkotil
Okay, let me answer all the questions. One of the other, the volume growth for the MHL organic business, you know, our guidance were always 7 to 8 percentage. You know, we have already reached the 7 percentage levels. We expect to continue at 7 percentage level 7 keep bettering it going forward. And at a group level we have done 10 to 11 percentage and we expect that’s the level that we will do for this year. Right. Coming to ampiga and the 60% growth, we said we grew it to 60% over a period of two years. Right.
And initially when we, when we took over, there are many things that we could do it and could get immediate gains, you know, hence that levels of growth you could see. But going forward, I think we’ll definitely see this business growing better than maybe the MHL business in the first year. Also.
Raman KV
Answer with respect to core diagnostics. So now it’s like EBITDA positive. Can we expect it to move shift towards higher, higher single digit margin by the end of this year? And can we expect the revenue led. By the volume growth to be above. The industry average about like 30 or 40%?
Surendran Chemmenkotil
Well, I think the EBITDA margins definitely are. You know, our estimate is that it will become a high single digit as we go forward and maybe in the year one exited a very high single digit number and revenue growth. Like Amira mentioned, we have to do some of our cleanup in the early days. And this year our focus is largely to get the synergies and margins corrected and getting the business as much cleaner as could and then focus on the revenue growth from the year after that.
Raman KV
Okay, thank you sir.
operator
Thank you. Our next question is from the line of Girish Bakru from Orbimad. Please go ahead.
Girish Bakhru
Yeah, actually I have few questions on core as well. So just wanted to understand this. Oncology super specialty and companion diagnostics, how big is that market? Do we have that number?
Ameera Shah
We don’t have the number right now off the top of our head, but we can certainly get back to you on this.
Girish Bakhru
And Amira, how many players? Let’s say we know that of course in organized diagnostics there are, I mean largely three, four handful players. Is that the same when we talk about companion diagnostics?
Ameera Shah
Not really. I mean, I think the lab chains or the organized players who are doing better on the oncology side may not be exactly the same as the top three incumbents overall.
Girish Bakhru
Okay. And when you’re talking about of course taking margins in Core gradually higher. I mean, just wanted to understand. One driver you have been talking about is of course putting more of the mix using Metropolis test in Core and of course growing Encore Specialty overall in Metropolis. You using Core, which of these two drivers will essentially drive that margin faster to the company level In Core, See.
Ameera Shah
The company level margin at core margin to company level will be driven more by cost synergies. Core was a good business on its own, but the chances of it making money on its own profitably was low because it was subscale. And the kind of corporate costs that were involved and the kind of lab costs that were involved would never have allowed you to make money on its own. Now, in the first quarter, if you see we have already integrated the overlapping labs in locations where Metropolis and Core both had labs, I think we have done almost five such overlaps.
So we have merged them. So like that, as you make code leaner and you are using shared infrastructure, we really believe that over the next three, four years we will be able to take Core to the company margins. And obviously then the revenue acceleration will also have to kick in by then, by year two, where you are able to really take this to more clients and you are able to get more tests from your existing distribution and increase your productivity for customers. So that’s how we believe that Core will become a profitable business.
Girish Bakhru
And Core, increasing margins and true health, of course doing very well. Can you give some directional, color or sense on where this RPT or RPP number should go trend wise for Core or for Metropolis? For Metropolis overall as an overall entity? I’m basically discussing this.
Ameera Shah
Yeah, see, I think if you look at the history, I think the last few years we’ve been seeing a 5%, 5% increase in RPP every year. And that’s coming from a combination of moving up the value chain and therefore selling more specialized tests to patients who need them. And that’s a journey that we believe will continue for Metropolis. So it’s usually, you know, pricing as you know, has got some part of it, but it’s not a huge part of it. The bigger part of it is really the product mix that plays an important role for it.
Girish Bakhru
Yeah, but can you like see it doubling over next five years? Is that possible?
Ameera Shah
I don’t think we’ve seen it double over the last five years. So I think that would be requiring a 20%, 15, 20% kind of an increase every year. So unlikely. But I do think that the kind of trends that we’ve seen in the past Five years I think can sustain as we go into the future.
Girish Bakhru
Okay, thank you.
operator
Thank you, ladies and gentlemen. Due to time constraints, I now hand the conference over to the management for closing comments. Over to you.
Ameera Shah
Thank you. And thanks everyone for joining us. As we iterated, you know, we feel very excited about the year 2526 for Metropolis. It’s a big year for us where we believe we’re going to take a big leap forward. Not only in breaking our own record for organic growth that we’ve seen, but also significantly improving on the margin, but really integrating the three acquisitions and making them really part of Metropolis and setting the stage for them to accelerate in the years to come. This year, as we’ve seen in quarter one, we’ve had a 23% growth and obviously we expect quarter two to be a much better quarter than quarter one.
Usually we know quarter two and quarter four are the best quarters in the year for our business in our part of the world. And we certainly look forward to doing all the things behind the scenes that lead to the right kind of outcomes that we have discussed with all of you as shareholders. And while we continue to really build Metropolis into even further technology enabled organization, we feel our team, we are set with a good leadership team to really take on all the challenges of this year. And we are seeing a lot of hunger and a lot of aggression on the ground from Metropolis.
We look forward to sharing with you guys more updates in the next quarter. And have a good weekend everyone.
operator
Thank you on behalf of DM Financial Institutional securities limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.