Piramal Diagnostics
Company Background (1/2)
Subsidy of Piramal Group
Founded in 1999 with the acquisition of
Tribedi & Roy Diagnostic centre in Calcutta
Grew exponentially between 03 to 08 through
acquisitions
CAGR 35% for last decade compared to
industry CAGR of 20%
Estimated to reach Rs 2000m in revenues by
Mar 2009
Company Background (2/2)
By 2008, Piramal was the largest chain of
diagnostic centers in India
104 test centers across 48 cities supported by
300 collection and pick-up centers
Centers of excellence in Mumbai for
specialized tests
Performed close to 4m pathology and
radiology tests in a year
Total manpower strength of 2200
Porter’s Five Forces Model
Threat of New Entrants (1/2)
Routine Tests (HIGH)
Tests ranging from Rs 30 to Rs 800
Low product differentiation
Low initial capital requirement
Absence of effective government policies for
restricting new entrants
Low possibility of getting cost advantage as
generating volumes is a problem
Average cost of opening at a rented place Rs 1
to 5 Lacs
Threat of New Entrants (2/2)
Specialized Tests (LOW)
Tests ranging from Rs 1000 to 15,000
High initial capital requirement
High brand equity
High expenses due to the ever changing
technology
Significant economies of scale benefitting the
current players
Threat of Substitutes (LOW)
With the invent of new technology the accuracy of
diagnostic tests was increasing
Self diagnostic tests for sugar, blood counts for
leukocytes, hemoglobin and urine analysis
Calibration and standardization is difficult and
complex
High initial and running cost
Users also need education and training to use the
equipments
Most tests require interpretation by experts
Glucometer for estimating blood sugar has been
the only one to gain some popularity
Bargaining Power of Buyers
Routine Tests (HIGH)
Low product differentiation
Patients visit labs recommended by doctors,
thus doctors enjoyed high bargaining power
Many players in the market