Thyrocare Technologies Ltd (NSE: THYROCARE) Q3 2025 Earnings Call dated Jan. 23, 2025
Corporate Participants:
Kapil Gupta — Manager – Strategy & Investor Relations
Rahul Guha — MD & Chief Executive Officer
Nitin Chugh — Chief Commercial Officer
Alok Kumar Jagnani — Chief Financial Officer
Analysts:
Prakash Kapadia — Analyst
Ashutosh Parashar — Analyst
Bino Pathiparampil — Analyst
Abdul Kader Puranwala — Analyst
Shivam Saxena — Analyst
Aditya Khandelwal — Analyst
Presentation:
Operator
Ladies and gentlemen. Good day and welcome to the Thyrocare Technologies Limited Earnings conference call. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference please signal an operator by pressing star and then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Kapil Gupta from Thyrocare Technologies Limited. Thank you. And over to you, sir.
Kapil Gupta — Manager – Strategy & Investor Relations
Thank you, Dorwin. A very good evening to all and thank you for joining us today for the Thyrocare earnings conference call for the third quarter of FY25. Today we have with us Mr. Rahul Gua, MD and CEO of Thyrocare. Mr. Alok Kumar Chagnani, CFO of Thyrocare and Mr. Nitin Chuk, Chief Commercial Officer of Thyrocare along with other key members of the senior management on this call to share highlights of the business and financials for the quarter.
I hope you have gone through our results release and the quarterly earning presentation which has now been uploaded on the stock exchange website. The transcript of this call will be available in a week’s time on the company’s website. Please note that today’s discussion may be forward looking in nature and must be viewed in relation to the risk pertaining to our business. After the end of this call, in case you have any further questions, please feel free to reach out to the investor relations team. I now hand over the call to Mr. Rahul Bhua to make the opening remarks.
Rahul Guha — MD & Chief Executive Officer
Thank you Kapil. Good evening and welcome to all on the call. Thank you for taking out time from your busy schedules to join us this evening. Just a quick introduction to us on the call. My name is Rahul Guha. I am the MD and CEO of Thyrocare. And thank you for the opportunity to present the Q3 results of FY25. I’m joined with my colleague Alok Kumar Jagnani who is our cfo Nitin Choke, who is our Chief Commercial Officer Kapil Gupta who is part of our strategy and investor relations team.
As in all my calls, I will start with a quote from Nelson Mandela. In recognition of our foray into Africa. It is in your hands to make a better world for all who live in it. And we believe Thyrocare can bring our business model to Africa to make affordable and good quality diagnostics available to all.
Before we get into the details of this quarter, I’ll reiterate the pay for performance pricing structure that we implemented in 2023. Earlier our discount was one size fits all but now we have moved to a SLAB based pricing model which we implemented last year. Been close to one and a half years since that implementation and this has led to an increased energy with our franchisee network. With motivation to move up volumes and enter higher slabs, it will result in a movement towards larger franchisees and available much greater reach from our large partners.
Quality remains our highest priority and we see it as a continuous journey of improvement and innovation. We are immensely proud to share that now we are India’s first and only 100% NABL accredited national laboratory chain. This prestigious milestone reflects our unwavering commitment to delivering world class diagnostic services and it is the result of relentless dedication to quality excellence. Achieving NABL accreditation across all our labs has been made possible through the implementation of robust quality management systems, investment in cutting edge technology and equipment, rigorous training programs for our staff and consistent participation in proficient C testing. Considering that only 2% of pathology labs nationwide hold this accreditation, this achievement is not just a significant milestone for us but also a testament to our leadership in redefining diagnostic standards across India.
Further, to validate our commitment to quality, we conducted an independent study published in the International Journal of Advanced Research Ideas and Innovations in Technology. The findings reveal that nine out of 10 doctors trust Thyrocare reports and confidently recommend our services to their patients. This recognition highlights the dedication and hard work that we have consistently invested in upholding the highest standards of quality.
Also, recently we were recognized and rewarded by the College of American Pathologists cap in short, for maintaining excellence in high quality laboratory care for 15 plus years. CAP is an international gold standard accreditation that represents the top tier quality in pathology and laboratory medicine. We regularly host advisory board meetings with a panel of esteemed doctors to gain their insights on enhancing our quality milestones. Doctors witness our cutting edge technologies and stringent protocols reinforcing our commitment to diagnostic excellence. I’m also very proud to say that recently we launched the largest HbA1C study across the country wherein we have studied 20 lakh HbA1C results to publish the largest insights on HbA1C in the country, while maintaining the highest quality standards. On an average, we released the report within 3.65 hours of samples reaching the lab. This rapid turnaround is made possible by our robust operational processes, advanced automation systems and streamlined workflow.
By combining precision with efficiency, we ensure timely and accurate diagnostics which empowers patients and healthcare providers to make informed decisions swiftly. Beyond the work on quality, we continue to selectively expand our offering. Aarogyam has been our flagship brand in the preventive healthcare segment and now we have Jansh as our disease specific packages. Jansh, as I have said before, is targeted towards lifestyle challenges or for you to better understand your health. We have solutions across the spectrum for anything you might be worried about. Is it fever or something more serious? Why is my hair falling? Is pollution affecting my health? Cancer screening as well as deep investigations for common chronic diseases like diabetes and heart health. We are very proud of some of the key milestones we have achieved in this quarter. We have 9,100 active franchisees. As a result, we processed 5.9 million samples and served 3.9 million patients in this quarter which is 15% and 13% year on year growth respectively in volume.
Total test conducted during this quarter was around 39 million which grew by 14% year on year. We are regularly taking strategic initiatives to further expand our footprint. In July 2024 we acquired Pololabs which is a pathology diagnostic company based out of Punjab with a presence in Punjab, Haryana and Himachal Pradesh. This allows us to expand our footprint in North India. We also acquired the clinical diagnostics business of WIMTA Labs in October 2024. WMTA’s Clinical Diagnostics division with its established presence in Telangana and Andhra Pradesh offers us an excellent opportunity to further strengthen our presence in South India.
Partnerships Business did phenomenally well in the quarter as you have seen in past quarters as well and grew as we onboarded new clients in health tech segments and continued to grow the existing accounts. Also with the acquisition of Think Health last year, it has strengthened our offering for the insurance segment with the additional capability of ECG at home. Now we are covering ECG at home services in thousand plus pin codes with a dedicated fleet of 125 ECG flebos. This allows us to give our insurance partners a one stop solution for blood and ECG testing and further deepens our presence in the pre policy medical checkup and annual health checkup market. And now we are the company who offers health checks with ECG at home and I’m sure that will enhance our Aarogyam brand.
In Tanzania since going live in March 2024 and processing our first sample in April, we have successfully partnered with over 100 healthcare facilities in Dar es Salaam. Our mission is to continuously collaborate with major hospitals ensuring they have access to comprehensive diagnostic services. With our state-of-the-art laboratory equipped with world class machines and infrastructure, we are poised to make a significant impact on healthcare in that region. With that I will now hand over to my colleague Nitin to cover the highlights for the quarterly business performance.
Nitin Chugh — Chief Commercial Officer
Thank you Rahul. A warm welcome to each one of you. First I would like to start with our pillars of growth which have been contributing strongly to our consistent performance. The first is customer success. The focus is to ensure accurate, timely and affordable diagnostic services through quality control, robust data management and customer support. With advanced technology and streamlined processes, we aim to enhance customer satisfaction. Just to give you an example, we have now started showing the turnaround time for reporting as a guidance to our franchise network which is further helping our franchises on predictability of reports delivery. The second pillar is network expansion. We are deepening our presence across India by going deep into the country with our franchise network and through our acquisitions as well. Also on the partnership side we are expanding our footprint by going deep into the pre policy medical checkup and annual health checkup in the insurance business. The third area where we are now focusing is to enhance our menu expansion and visibility. We are introducing a wider range of specialty tests and health packages for our partners, using targeted marketing to drive adoption and increase value for both partners and our customers.
Again, an example of this is introduction of Fetal medicine foundation backed certified pregnancy markers and starting histopathology and cytology in house in our labs is a testament of our focus on expanding our menu with highest quality standards.
Now I will briefly update you about the business performance highlights for the third quarter of FY25 overall at a consolidated level we did a 23% year on year revenue growth this quarter primarily driven by our pathology business. Our franchise business showed a revenue growth of 24% year on year. This includes 5% of inorganic growth coming from our recent acquisitions of Polo and Vimta and 19% organic growth. And this has come on the back of focus on customer success, menu expansion and network expansion.
Our partnership business grew by 23% year on year wherein our API pharmacy diagnostic business also showed a growth of 19% year on year. Radiology business including Pulse High Tech did a strong revenue growth of 13% year on year. With that I will hand over to my colleague Alok to cover the results.
Alok Kumar Jagnani — Chief Financial Officer
Thank you Nitin, and a warm welcome to everyone joining us today. Before we dive into the specifics, I would like to emphasize that while the pathology diagnostic industry is growing at an early to mid teen race, we are consistently achieved mid teen to high teen growth over the past few quarters. This sustained outperformance reflects the strength of our leadership and our ability to capitalize the on market opportunity.
Before diving into the financials, I would like to revisit our ESOP program, which has in focus in previous quarters. This initiative, introduced at a group label, a design, retained the talents at thyrocare. The ESOP issued at our parent company will vest according to the policy. From an accounting standpoint, these are recognized as an expense in the profit and loss account and as a equity contribution from the parents in the balance sheet. It is important to emphasize that this is a non cash charge and does not impact the company cash flow. Accordingly, we calculate a normalized EBITDA to account these expenses. Further details can be found in the accompanying presentations uploaded.
This year. As the thyrocare ESOP program is coming to an end, the group has expanded the API ESOP pool to the senior management at Thyrocare. For the quarter, revenue stood at 153 crore standalone and at a consolidated level 166 crore reflecting a 23% year on year growth. This growth was driven by strong 24% rise in franchisee revenue and a 23% increase in partnership revenue. Total pathology revenue grew by 24% year on year while the radiology revenue saw an increase of 13% year on year. On the total 23% revenue growth, 19% has driven from organic while the remaining 4% resulted from the inorganic expansion. Think Health and Polo business have largely stabilized and now fully integrated with the thyroid ecosystem. Meanwhile, the acquisition of Vimta Clinical Diagnostics is currently in the transition phase with operations expected to stabilize and consolidate within the next three to six months time.
Our standalone gross margin for the quarter was 72% 72% up by 181 basis point primarily due to one time audit notes and basis volume target with our vendors, corrections one time credit note and basis volume target with our from our vendors. Employee expenses increase year on year driven by annual increment and headcount growth from new business acquisition. The standalone normalized EBITDA margin for the quarter stood at 31%, an increase of 375 basis point primarily due to margin improvement and operating leverage.
EBITDA margin in radiology business NHL has improved as compared to the last year due to growth in revenue and efficiency in other expenses. At a consolidated level, gross margin stood at 73% while the normalized margin EBITDA margin was 30%. Our normalized EBITDA grew by 42% year on year while reported EBITDA increased by 32% year on year and PAT increased by 30% year on year. This performance was achieved despite margin pressure from recent acquisition Geographic expansion, high non cash ESOP cost and increased depreciation expenses due to the change in accounting estimate. Now I will hand over the call to Rahul for strategic updates.
Rahul Guha — MD & Chief Executive Officer
Thank you Alun. Briefly I would like to take a few minutes to recap to you our strategic direction and then I will open it up for Q and A. First I will reiterate our value proposition to the customer. We will continue to remain an affordable option to all patients with good quality and on time reports. All our efforts on our value proposition is towards ensuring low cost to the patient, assurance on quality of testing through our certifications and engagement with doctors. We have made tremendous progress on this which I have updated in my initial comments and is reflected in detail in the presentation. This will remain at our core and will continue to guide all that we do. Second, our strategy. We continue to maintain our strategy of being the B2B partner of choice to all front end diagnostic services companies in India. Whether it is a small diagnostic center in a semi urban area, a pharmacy in a metro, a small nursing home, an individual doctor or or a leading online diagnostics platform, a health tech marketplace, we are happy to work with them to provide low cost robust testing solutions so that they can serve their patients in the most effective manner. If they require phlebotomy or ECG at home, we are happy to mobilize our network of almost 1500 phlebotomists, including our network partners, to serve them better.
We remain dedicated to expanding our business and with the acquisition of Polo Labs and Vimta Clinical Diagnostics we plan to significantly increase our presence in north and South India respectively. Additionally, to further boost our partnerships business, the acquisition of Think Health allows us to offer ECG at home services, further enhancing our value to our insurance partners. This strategy has been working well for us with both our franchise and partnerships businesses posting strong growth. That in a brief is our mandate as management. Thank you so much for giving us a patient hearing. I will once again end with a quote from the Mahatma, Find purpose. The means will follow, and our purpose remains to provide affordable high quality testing to the masses. With that we’ll open up for Q and A.
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 the Touchstone telephone. If you wish to withdraw yourself from the question queue, you may press star and 2. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have the first question from the line of Prakash Kapadia from Spark pms. Please go ahead.
Prakash Kapadia
Yeah, couple of questions from my end. Generally, you know, we’ve seen Q4 is a strong quarter for us. So you know, what kind of growth are we looking at on a sequential basis? And also, you know, if you could comment on, you know, the range of health packages we have and what is the contribution to our annual sales? Maybe last year and you know, currently in the nine months. That’s my first question. Secondly, on the franchisee network, can you share some, you know, color in terms of contribution for nine months? In terms of Silver Bronze, how is the strategy of, you know, focusing on larger franchisees? How is the throughput increasing through them and what kind of, you know, franchisee addition is possible from year on, say next year and beyond? And lastly, you know, there have been media reports suggesting pharmez is contemplating a reverse merger with Thyrocort. So any, you know, comments, any discussions? These were my three questions.
Rahul Guha
Sure, Prakash, thank you for the questions. And see, the momentum for the business as you can see is quite strong. Right. If I look at YTD also, we have kind of landed at around 20%. Whereas in the beginning part of the year I was indicating mid teens is what I would be happy for with. Of course Q4 last year was very good for us also. Right. So when you look at it on a year, on year basis, you know, it is off a very good quarter. And yes, while definitely Q4 will be much better than Q3, you know, to give you a specific growth number at this point in time will be difficult. But I will be happy if we are able to continue the YTD momentum into the fourth quarter as well. Right. That is as much, much as I can kind of speculate at this point. With regard to package mix, see we have two main brands. We have Arogyam and Jans. Right. Rogam roughly accounts for about, I think last about 35% of our total sales. And Jans would be about, I would say 3 to 5% in that range. Jans has doubled over the previous year. ROVM continues to kind of track our normal growth. So as a mix it is growing Jans but is of a small base because it’s. The brand is little over a year old. So it will take some time to mature but the growth rate is very encouraging. Right. So that is that now when it comes to the mix between franchisees. Right. So I guess you are quite privy to our categorization of Diamond. So diamond to Silver, Prakash has grown at, at A volume level it would have grown at about 25% and Bronze and others would have grown at 9% on a volume level. Okay, so it’s line with what? Yeah, very much in line with what we were planning. And you know, as that mix shifts also we get much better retention, much better average revenue per franchisee because everyone is incentivized to move up the ladder. Right. So that goes very well for us. On the pharmeasy point. See, firstly the media reports are idle speculation. It’s very difficult for me to comment on, you know, articles that are speculative in nature. What I can tell you is that the Thyrocare board, none of this has been discussed or contemplated. So it seems like this is just media speculation at this point in time.
Prakash Kapadia
Understood. And you know, if you could comment on the range of packages, you obviously mentioned the contribution of Aragyam and jaj. So the range of packages which we have at, you know, Aarav or JAJ obviously would be much smaller in terms of pricing because you know, it’s bucketing into different segments. So what kind of a range of package say starting from 2000 to 7000 rupees or Jaj would be 500 rupees. Some, some color on the pricing or the range.
Rahul Guha
Sure. Maybe I’ll let Nitin also chip in. But just to give you a sense, Rogum actually starts from Rogm A to Rogum Excel. Rogum A is priced at 1000 rupees. Rogum excel is closer to 10,000 rupees. Right. So starting from thousand rupees to 10,000 rupees we have the full range of packages and the number of parameters start at about 40 and go to almost 200 plus. In the, you know the, in our largest things. I think Excel is 139 or 145. Yeah, if I remember. So we have the full range. That being said, the most popular package is Arogam C which Is in that 2000-2500 rupee range. Nitin, you want to add.
Nitin Chugh
Yeah, that’s absolutely correct. And if, if you talk about judge also see judge also covers a various types of therapy areas. So basis the type of therapy area and what test is includes. It also starts the basic tests of charts for a certain therapy starts at about thousand odd range, 800 to 1000 odd range and they also go up to like a 4000, 5000 kind of.
Prakash Kapadia
Okay, okay, okay. That’s a broader range. Okay, understood, understood. I’ll join back if I have more questions. Thank you.
Operator
Thank you. Participants who Wish to ask questions May please press star and one we have the next question from the line of Ashutosh Parashar from Mirabilis Investment Trust. Please go ahead.
Ashutosh Parashar
Yeah, hi, thanks for the opportunity and Congress on another
Operator
But you do sound a little unclear. Sir. Yeah.
Ashutosh Parashar
Is it better now?
Operator
This is a little better. Please go ahead.
Ashutosh Parashar
Yeah, thanks. Yeah. So congrats on another good quarter. So a couple of questions. First is on the Vemta Labs acquisition. So if you could just share how long has it been consolidated in current quarters number and run rate, what is the current quarterly run rate you are expecting it will generate in the coming quarters, and maybe outlook on the next year after all the consolidation happens. So first is on that and second is on. So we have been focusing on partnering with a lot of insurance players and Medtech players on the pre policy health hacker and annual insurance healthcare plans. So if you could give us some numbers on number of partners that we are currently working on within insurance space in the Medtech space, and how much is it contributing in the entire partnership revenue pool. So these are the first couple of questions and then lastly on the esop, the new ESOP pool that we are creating, what is the the pool size and how will be amortizing the PNL over the next few years? So those would be the questions.
Rahul Guha
So I’ll break it up, I’ll let Alok take the Vimta question and I will let Nitin take the insurance question. So Alok, if you would like to cover when we acquired mta, how much does it sit in this quarter and what do we think will be the run rate over the next few quarters?
Alok Kumar Jagnani
Yeah, so thank you. So in Vimta we have acquired in the mid October and it’s only a two and a half month has gone. Vimta is in a stabilization phase and it will take another three to six months time to consolidate and set up with the entire Thyrocare ecosystem. In terms of revenue around 4 to 5, 4 four and half crore rupees has been added on account of vimta in the Q3 as the inorganic growth which we have seen highlighted also that around 4% of the total revenue contribution has come from inorganic which in which four and half crore has contributed by Vimta as when we have acquired Bimta, Bimta was a turnover run rate of 2 crore approximately with a mix of B2B and B2C business, and we are trying to retain the maximum what we can retain the business because there’s a lot of mix B2B and B2C we are primarily a B2B player and also focusing what B2C with a various means of strategy, what we are going to do and the consolidation, other activities are in progress. So in next six months the entire consolidation, the transitions are going to be completed.
Rahul Guha
So I would say you know, if you’re looking for a forecast you should not look at more than between 3 and 4 crores a quarter at least for the next four quarters till we stabilize Wimta and then we will see from there, whether we grow under the Wimta brand or we, you know, use that network to expand the Thyropare brand in AP and Telangana and then therefore where the revenue gets reported but at a steady state at least for the next two quarters I can definitely say don’t expect more than 3 to 4 crores a quarter from Vimta. Nitin, you want to take the insurance question?
Nitin Chugh
Yeah. So insurance business, we have taken some steps towards increasing that especially in the quarter three we are now working with. I cannot obviously name the partners right now but we are working with more than five aggregators or TPAs which in turn service about 10 odd insurance partners. And this business especially on the PBMC side has been steadily growing and contributes to almost 10% of the partnerships business. This is excluding API Pharmacy the remaining partnerships business 10 more than 10% around 1213 is contributed by insurance.
Rahul Guha
He was also asking like how many insurance.
Nitin Chugh
I just told then we work with health aggregators and partners. There are about four five to six that we are currently working which in Turn service about 1012 insurance partners.
Rahul Guha
On the ESOP pool question there was an old ESOP pool of about 43 crores that was at the. Actually first let me clarify. These are API group OR API holdings ESOPs not Thyrocare ESOPs. So there will be no dilution of Thyrocare shareholding as a result of these ESOPs. These are ESOPs granted by the parent to employees of the subsidiary. The second point is this is a non cash charge which Alok already explained once, it’s routed via the P and L but it has no cash impact on thyrocare. The old ESOP pool which was at the pre IPO price of API was about 43 crores and the new ESOP pool is about 47 crores which is at the the revised price. These so there are two things that have happened. One is of course the old ESOPs you know have already been fully charged into the P and L but given the prices of at the API side to retain the Talent the API group felt it was prudent to expand the pool. So actually they. There was a very limited pool in Thyrocare that was getting API ESOPs. Now it’s a much broader set of employees who are getting these ESOPs. The ESOPs are being charged over the P and L over a period of six years and that is the broad vesting schedule as well. So it’s there to ensure that the talent remains, you know, for the long term to create value for the business.
Ashutosh Parashar
Oh yeah, thanks. So just a follow up. So earlier food was around. Yeah, yeah, just. Sorry, just one follow up. So earlier pool we have charged fully to the PNL and the new PN new 45 crore Roughnee pool will be charged over the next six years.
Rahul Guha
Yeah, you would see in the P l roughly about 7 crore charge in this quarter. That of course comes down as the calculation pans out but you’ll see it in the pn.
Alok Kumar Jagnani
So in the initial years like the vesting period is 5 years and 6 years depending upon the vesting spot has Grant has offered and initial first year, second year and third year the charge to the PNLs are going to be on higher side whereas over a period of four to fifth years we will find that the charges are comparatively much lower.
Ashutosh Parashar
Got it. Just one last follow up on the Vemta Labs acquisition. So during the time of acquisition I guess in our filing we had mentioned that it had Q1 revenues of around 7 crores. So some anything that we have closed down from the acquisition that has led to this reduced run rate from 7 crores to roughly 3 to 4 crores.
Rahul Guha
Yeah, there were some businesses that were being done for clinical trial which we did not want to continue. And then there were some geographies why we had acquired Wimta to deepen in the south of India but Wimta had also labs in Up Orissa which you know where the Thyrocare network is already very strong. So we didn’t see any sense in duplicating that network. So that business we moved into, Thyrocare and whatever remaining Vimta business is largely focused towards South India.
Ashutosh Parashar
Got it. Thanks a lot for answering the question. I will get back in the queue.
Operator
Thank you. The next question is from the line of Bino Pathiparampil from Elara Capital. Please go ahead.
Bino Pathiparampil
Hi, good evening and congrats on a good set of growth numbers. Just couple of clarifications. The 38 lakh count that you have given that does that include all the Vimta Polo, all these acquisitions that you done
Rahul Guha
Which. Tom. Sorry, you said 38 lakh.
Bino Pathiparampil
38 lakh. 38 lakh lak. Number of lakhs.
Rahul Guha
Yeah, yeah. That includes Wimka and Polo now.
Bino Pathiparampil
Okay, great. Second on the ESOP cost continuing. So this quarter was 7.2. So for the next three more quarters, should we expect a similar number? 7 crore.
Roughly a quarter.
Rahul Guha
Roughly. It will go down marginally because the original 3.1 will come down. Right. So to that extent you will see some benefit, but it will be in this range.
In addition, if additional schools are going to be offered, then added, then the charge will be higher. Otherwise it will be more or less flat.
Bino Pathiparampil
Okay, so is it going to be an ongoing process, the addition of pools, or was it a one time exercise?
Rahul Guha
No, largely it was a one-time exercise. I don’t anticipate too many more pools being created at this point.
Bino Pathiparampil
Okay, Mr. Second question on depreciation. On your notes you have said that you have reassessed the life of some of your machines.
Operator
Ladies and gentlemen, the current participant seems to have dropped from the queue. We have the next participant, Mr. Abdul Qadir Puranwala with the next question. Please go ahead, sir.
Abdul Kader Puranwala
Hi, on this ESOP charge again, so the 7.7 crore, I mean, if you could help us to understand how, what would be that number in FI26 and 27, I understand that might be certain job, but if you could help us quantify that.
Alok Kumar Jagnani
So So here, like Rahul mentioned that the pool is a new pool of 47 crores has been added in the in this ESOP API, and which is going to be a resting period of five years. So in this quarter, the charges come 7.7 CR. And in subsequent quarters, we will see more or less in practice next two three quarters, we will see the same charge or the slightly lower charge. And then the impact of second year and third year is going to be 31%. Then 20% and then Putin and all, which you see the last because it has a present value impact, pricing impact and timing gaps because first year. What we’ll do is next quarter we include the charge schedule so that you can see it. We’ll show it for the full year and we’ll give you a schedule of how it will be charged in the PNL over the next two, three years. But as Alok said, of the total pool of 47, typically 30% is charged in the first year, 20% in the second year, I think 15% in the third year, and then it goes. 10 in six, normally that’s, normally that’s it.
Abdul Kader Puranwala
Got it, yeah, that would be helpful if you can add that to the presentation. So second is on the depreciation cost, where I understand there was some asset-related adjustment. So just wanted to understand first of all, not a consolidated, the 17 crores of depreciation cost, does that include any one of, or this is the quarterly rent rate to what we can see in quarters ahead as well?
Rahul Guha
I’ll let Alok take this.
Alok Kumar Jagnani
So yeah, so there is a one-off here. So we have revised our assets life expectancy, and we have based on the revised expectancy of assets life. the depreciation hit has come and the hit has taken on the prospectively. The hit, one time hit has come in the depreciation because of the revised estimates of the depreciation is 4.75 crore. The main call what we have taken like we was having the old assets which we are depreciating at a life of 12 to 14 years which we have revised to 7 years. Because of the change in life expectancy, the depreciation impact has come.
Abdul Kader Puranwala
I guess this question is this 4.7 crores. Do you expect it next quarter?
Alok Kumar Jagnani
No, it’s a one time.
Rahul Guha
Yeah. So to answer your question, Abdul Qadir, there is a one off in there. And that’s largely due to the revision in policy.
Abdul Kader Puranwala
Okay, so 4.75 crores will be the one off this quarter. Understood. And on your operations in Tanzania, how do you own your opening remarks about 100 healthcare events you have been tied up with? Any color on what is the revenue potential you see coming from Tanzania, what we are doing and what sort of margins you can make there?
Rahul Guha
I’ll let Nitin take that. As I said, look, we processed our first sample in April. Yeah. Right? So we have started to get initial samples from, you know, hospitals and in Tanzania, it’s largely polyclinics, you know, that work with us. But it’s, you know, they’re trying us out right now. So it’s not a, how do you say, very large business at this point. I think in Q3, it would be about, you know, 35 lakhs of top line. But I’ll let Nitin give some more color on this.
Nitin Chugh
Yeah, so see, it started in Q1 of FY25, right? And the quarter two was like 10 lakhs a quarter, and then we moved to 30 lakhs. It’s still at a very nascent state. So any kind of guidance is very difficult to be given at this point. It’s just that we are on the ground working and you know, tying up with more and more partners, we have crossed 100 partners in the Dar-Islam region, which are like Rahul said, are trying us out. So it’s a matter of time where we slowly not only just increase our partnerships base but also increase wallet share from existing partners once they have started trying our services.
Abdul Kader Puranwala
Got it. And just final note from my end in terms of your KPEX program. So Leo is talking about some refurbishment KPEX for the radiology business. So we completed that and you know, how do we see that the KPEX spending pay for the FI 26 and 27 if you could give us some color there.
Rahul Guha
So firstly on the radiology business we have not incurred a large amount of capex nor is there any plan to significantly invest in capex in the radiology business. The machines are old but still running and you know at this point we will look at refurbished options should machines come to end of life but we are not going to fresh capex. put in a lot of fresh capex into this business. When it comes to our total capex that we have spent in this year, I think up to Q3, we’ve spent about 15 crores. And, you know, and I think over the entire year, you can assume maybe another 10 crores odds. So that is broadly which is the new lab and that I had indicated in the beginning. But I think that’s about it.
Abdul Kader Puranwala
Sure, sir. Got it. I’ll join back with you. Thank you.
Operator
Thank you. Participants, to ask a question, you may press star and one. We have the next question from the line of Shivam Saxena from ICICI Bank. Please go ahead.
Shivam Saxena
Yeah, hi, thank you for taking my question. Just having a question on that, is there any impact of recently India has banned import of refurbished machine? Any impact do you see on your operation? On your port?
Rahul Guha
We stopped the policy of buying refurbished machines, I would say almost two years ago. Yeah, correct. All the machines that we buy today are brand new, top of the line equipment. So we haven’t been impacted in any way by this.
Shivam Saxena
And how do you see pricing and environment going forward in this case?
Rahul Guha
The pricing environment as I was saying over the last three, four quarters has softened. I’m not seeing as much price competition as we did, let’s say, last year at the same time. A lot of rationality has set in. And so we are now mostly competing on service and quality rather than price. And this is the sector which, to some extent, Deep discounting doesn’t work, right? And I think many players who try to take away share from this business by doing deep discounting have realized that one, you don’t get the volume, two, your cost structure remains unsustainable. So I’m seeing a fair amount of rationality in pricing right now. I’m not saying India’s prices still remain the lowest in the world, but at least within India, you know, definitely some easing up on price competition. I have seen over the last two, three quarters and hopefully we will continue for some time.
Shivam Saxena
Thank you. All the best.
Operator
Thank you. We have the next question from the line of Aditya from securities investment management. Please go ahead.
Aditya Khandelwal
Yeah. Hi. Thanks for the opportunity. I just needed one clarification. So since all the softs are being done at API level, so ideally there shouldn’t be any dilution at higher. Okay. But when I look at QoQ, our number of shares have increased. So what has led to that?
Kapil Gupta
Yeah, so one is, let me confirm, there is no dilution in thyrocare. I will say it repeatedly. However, as I mentioned, there is a thyrocare resub program that is coming to the end. So the share increase that you’re seeing in the BenPOS and in the shareholding reporting, is basically the share under the Thyrocare ESOP program that would declare granted and vested by Thyrocare employees and now they hold the shares in their hands.
Operator
Thank you. The next question is from the line of Ashutosh Parashar from Mirabilis Investment Trust. Please go ahead.
Ashutosh Parashar
Yeah, hi. Thanks again for the opportunity. So just another question on Vimta was what is the kind of profitability profile that it is currently working on? And after InSoup is we look at the margin of around 25.2% at the report in quarter, do we expect it to increase from the next quarter or will we have some kind of impact from the acquisition?
Rahul Guha
Sorry, your question was not very clear, Ashutosh.
Ashutosh Parashar
Umar, I’ll start. Yeah, so I will repeat it. Yeah, yeah, sure. So the question was on the Wimpa Labs profitability. Since the revenue run rate has somewhat reduced, so is it profitable for us at the EBITDA level at the moment? And the current quarter’s margin after ESOP that we reported around 25.2 or 3 odd percent? So do we see this margin at the current level for the next couple of quarters? By the time it gets consolidated fully and then the revenue relative increases or should we expect it to normalize to 26.7% from the next quarter?
Alok Kumar Jagnani
So the Vimta profits are, I mean, around one, sorry, the loss, EBITDA loss at Vimta is about, you know, 1.4 crores for the quarter, which is baked into the financial. There are no ESOPs in Vimta. So, you know, that has, so keeping that aside, if I look at the next quarter, you know, we definitely expect those losses to come down. Will they become zero? Probably not. But will they be? at this level also know, right? Our goal is at least to get it to zero, you know, towards the back half of the year. But definitely it will not be at this level.
Ashutosh Parashar
Got it, thanks. Thank you.
Operator
Thank you. Ladies and gentlemen, we have no further questions. I would now like to hand the conference over to Mr. Rahul Guha for closing comments. Over to you, sir.
Rahul Guha
Thank you everyone for joining us and spending us time with us this evening. I want to go back to the original question on the reverse merger, you know, speculation that has been in the media. Once again, I would like to say at the Syrocare board, this has not been discussed and you know, therefore this remains largely speculative in nature. I would like to remind all Syrocare shareholders that, you know, Should anything like this come up, it would require a affirmation from the Thyrocare shareholders and would require a majority of the minority. That being said, it remains at this point media speculation. However, the company performance of Thyrocare is on a fantastic growth trajectory, with both revenue much above the industry growth rate. and the profit growth also coming through despite all the different hits that we’ve had to take that Alok shared. And we continue to remain focused on maintaining this kind of growth trajectory and improving profits as we go forward. As always, we continue to remain focused on our strategy, which is to be the most affordable, good quality diagnostic testing partner for anyone in the healthcare business. and we continue to execute on that strategy. We have been investing in improving our quality, improving our reach, and ensuring our turnaround time is as close to best in class. And we’ve made substantial progress on all of this, and that is what is driving the results that you see. I thank you all for your support in this journey, and I wish you all a good evening. Thank you.
Operator
On behalf of Thyrocare Technologies Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your line.