Laxmi Dental’s Stellar Q3 FY25 Performance Faces Valuation Reality Check

Published 14-02-2025, 10:42 am
© Reuters.

Laxmi Dental Limited has reported exceptional financial growth in Q3 FY25, posting strong improvements across key performance metrics. The company’s consolidated revenue surged 29% year-over-year to INR 616.6 million, up from INR 477.9 million in Q3 FY24. Profitability metrics saw even more impressive gains, with gross profit margin expanding to 73.9% from 72.2%, reflecting better operational efficiency and cost management.

EBITDA witnessed a staggering 144.7% growth, reaching INR 96.1 million, with the EBITDA margin improving sharply to 15.6% from 8.2%. The bottom line was equally strong, as profit after tax (PAT) more than doubled to INR 48.2 million, a 105% year-over-year increase. The PAT margin expanded to 7.8%, up from 4.9% in the previous year, showcasing the company’s ability to translate revenue growth into sustainable profitability.

Additionally, Laxmi Dental’s strategic investments are paying off, as reflected in its adjusted EBITDA, which includes 60% of Kids-e-Dental’s PAT. This figure grew 83.5% to INR 107.9 million, underscoring the success of its expansion initiatives. The positive momentum extends beyond the quarter, with the company’s nine-month performance in FY25 showing a revenue increase of 28.8%, alongside continued margin improvements.

Image Source: InvestingPro+

Despite Laxmi Dental’s stellar operational performance, its stock valuation presents a different picture. According to InvestingPro’s fair value feature, the company’s intrinsic value stands at INR 381.1 per share, which suggests a 4.8% downside from the current market price (CMP) of INR 400.5. The stock has already faced a steep decline of 18.8% this month, hitting a new 52-week low of INR 400.5.

Investors who had access to InvestingPro’s fair value would have been able to make more informed decisions—either avoiding the stock when it traded at around INR 550 or booking timely profits from their long positions. This highlights the importance of leveraging precise stock valuation tools before making investment moves.

With InvestingPro, investors gain access to real-time fair value estimates based on multiple financial models, providing an accurate assessment of whether a stock is overvalued or undervalued. For those looking to refine their investment strategy, InvestingPro is currently offering discounts of up to 45% on subscriptions, making this the perfect time to access its advanced stock analysis features.

Read More: How AI Could Have Turned Rs 10,000 into INR 1.73 Lakh in 6 Years

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