Molbio Diagnostics Extends Fall to Second Session, Drops Nearly 9% After Recent Rally

The stock of Molbio Diagnostics slipped into the red for the second consecutive session on Wednesday, September 16, after it made rapid gains within a month from the time it entered the market. 

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The stock tumbled up to 8.8% to trade at ₹1,229.65 on the BSE. In the process, the stock has fallen by 18.5% over the past two trading days amid some profit taking following the sharp rise in recent times. 

This despite the overall Indian equity market continuing to gain. 

Recent gains give way to profit booking 

The two-day decline follows a period in which Molbio Diagnostics had moved considerably higher in a relatively short time. The stock had gained 13% over the previous week and 75% in the past month. 

It touched a 52-week high of ₹1,686.50 on September 11. Its 52-week low of ₹925.80 was recorded on August 17, the day it listed on the stock exchanges. 

Despite the latest fall, the stock remains more than 50% above its IPO price of ₹807. 

Molbio Diagnostics made its market debut on August 17 at ₹980 a share, a premium of 21.44% to the issue price. At that listing price, an IPO lot of 18 shares was worth ₹17,640 compared with the initial investment of ₹14,526. 

Since listing, the shares have delivered a return of about 52% over the IPO price. 

Q1 revenue rises sharply as company returns to profit 

The stock’s earlier run also came after Molbio Diagnostics reported a turnaround in its financial performance for the April-June quarter of FY27. 

Consolidated net profit attributable to the company’s owners stood at ₹58.74 crore for the quarter, against a net loss of ₹23.74 crore in the corresponding period a year earlier. 

Revenue from core operations climbed 309% year-on-year to ₹408 crore from ₹100 crore. 

Operating performance also moved back into positive territory. EBITDA for the quarter stood at ₹101 crore, translating into an EBITDA margin of 25.20%. In the same quarter last year, the margin was negative at 14.43%. 

Company expects 25% topline growth in FY27 

For the full financial year, Molbio Diagnostics has guided for topline growth of 25%, with an EBITDA margin of 24-25%. 

The company has also indicated that its quarterly performance may not follow an even pattern because public-health procurement can vary from one period to another. It therefore expects its performance to be assessed over the full year rather than through individual quarters. 

Gross margins across its devices and test kits are in the 60-63% range. 

The company is targeting opportunities in the point-of-care diagnostics market, which it estimates at $30 billion and growing at a compound annual rate of 17.9%. 

Molbio Diagnostics has also indicated that manufacturing capacity is currently not a constraint. Automation and its research and development centres remain among the areas of focus for the use of IPO proceeds. 

After reaching ₹1,686.50 less than a week ago, the stock’s latest move marks a sharp change from its post-listing rally, with two sessions of selling taking 18.5% off its value.