© 2024 Alpha Spread Limited. All Rights Reserved.
www.alphaspread.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on www.alphaspread.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. In no event shall Alpha Spread Limited be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on www.alphaspread.com, or relating to the use of, or inability to use, www.alphaspread.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance.
You don't have any saved screeners yet
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Thank you, and good evening, everyone. On behalf of ICICI Securities, I welcome you all to the earnings Q2 FY '21 Earnings Call of Metropolis Healthcare Limited. Today, we have with us senior management team of the company, represented by Ms. Ameera Shah, Managing Director; Mr. Vijender Singh, CEO; and Mr. Rakesh Agarwal, CFO. With this, I'll hand over the call to the management. Over to you, ma'am.
Thank you. Good evening, everyone and thank you for joining us for the Q2 FY '21 earnings call, and I hope you and everyone around you is safe and in good health. I'm joined today by Vijender Singh, CEO; Rakesh Agarwal, CFO; and SGA, our IR Advisers. The presentation and press release have been issued to the stock exchanges and uploaded on our website as well. I hope everyone has had the opportunity to go through the same. Let me start by sharing with you that we at Metropolis Healthcare has been confirmed (sic) [ conferred ] with the Frost & Sullivan Company of the Year award in the Indian Diagnostics Services Industry 2020. We have been recognized for our excellence in growth, innovation and leadership. This is indeed a proud moment for all of us at Metropolis. We are pleased to share with you that Metropolis and its entire employee base has remained committed to serving the nation during the pandemic and work tirelessly ensuring that our timely results, test and accuracy has been consistent throughout. With leading the industry in terms of commencing RT-PCR testing in March 2020, setting up dedicated teams for COVID and forging corporate tie-ups for testing for the needy, we have continued to improve traction on our overall business. While we may not have been very vocal about the opportunity considering the unpredictable nature of the COVID-19 business, we have put all efforts in serving customers, and that has only strengthened our brand equity. This is truly the strong resilience of the Metropolis team.Let me now move ahead by giving you a strategic lens of the 4 pillars that we believe will continue to drive our business growth ahead. The first is our growth on the non-COVID piece of the business. After nearly 6 months of gradual uptick, we achieved 100% recovery in non-COVID PCR business in September 2020. This is a result of our efforts on increasing physical coverage with doctors, opening up of clinics, scaling up on testing services, tie up with institutions and corporates. And all this has ensured we are able to strengthen our business model. We continue to focus on achieving growth in non-COVID business and foresee the business to resume normalcy in Q3. The second is home testing services. We strongly believe that home testing is an important part of our strengthening the Metropolis brand proposition in the minds of consumers. And when it is bundled with large test menu, safety measures, best-in-class turnaround time, the results fall in line. In form of higher growth, where home testing services as a percentage of B2C business, excluding COVID, now contributes 19.6% of revenue, up from 14.6% in H1. In H2 -- I'm sorry, in quarter 2, this number is closer to 25%. This configuration has been aided by our presence in 9 locations currently, which we plan to scale up to over 65 locations by the end of Q3. This is regarding home testing. Number three, the third piece is the digitization efforts that we have built in our brand, which is continuously engaging and communicating with consumers, creating digital partnerships, digital record for consumers, doctor engagement, B2B portal, enabling us to become a complete end-to-end digital service provider for not only customers but for every stakeholder. Happy to state that we have reached an audience to the magnitude of 25 million via our digital communication efforts.The fourth piece is our M&A efforts, which we believe there is tremendous opportunity for, given the large and organized share in the diagnostics industry and given the need of the consumer to be associated with a strong knowledgeable brand, which has reach, strong testing capabilities, and safety and trust as part of its ethos. While we continue to evaluate opportunities for small M&A, we are also open and are evaluating mid and large size M&A deal. Depending on the strategic fit, scale and size of business, the valuation parameters could differ. For us, leadership position of the acquired business, brand recall amongst consumers, integration of the brand and overall health quality of franchise will determine closure of deals for us. Q2 FY '21 has been a strong quarter for us. We achieved the highest ever quarterly revenue as well as our best EBITDA margins to date. Clearly, the operating leverage benefit played out in the quarter, which were driven by increased utilization of lab and patient visits coupled with superior product mix, increased home testing visits, which reached almost 20% in B2C for non-COVID test. And this is a better margin profile on the back of many efficiencies on cost and processes that we have built in the service offering. Automation and digitization, which has led to increased cost control and monitoring, and cost efficiency initiatives where we have encouraged innovation and critical thinking due to operational cost efficiency. And five, increased revenues and economies of scale benefits. Having said this, a contributor to the revenue growth has also been large-scale COVID testing, which is unpredictable and its contribution going forward is likely to be dependent on external factors. While large part of savings initiatives are sustainable, we believe it is our duty to reward our employees who have worked tirelessly throughout this pandemic. We are therefore announcing revision in employee salaries for their loyalty and support to strengthen the Metropolis brand. This will have some impact on margins going forward. However, they will still be strong and healthy. And therefore, our efforts will be more geared towards increasing the non-COVID revenues, of which we believe the following will be the drivers: increase in elective surgeries as increased number of people will opt for surgery than what was the case here in the peak of the pandemic; higher number of doctors will open clinic for longer duration leading to higher patient visits in the doctor ecosystem and therefore, diagnostic ecosystem; number three, increased contribution from B2B revenue, in our case NACO and MCGM contracts; four, shift of testing from unorganized labs to organized labs like us on the back of increased awareness amongst consumers on the importance of hygiene and safety of diagnostics testing; and number five, higher traction from wellness test, which will open up further as consumers start realizing the need of periodical care and updation of their medical history. I will now highlight a few points that we believe are an outcome of our continuous efforts to build a strong franchise. Number one, we continue to maintain a healthy and improved balance sheet. We are a zero debt and net cash company. We have improved our working capital cycle on back of steady increase of B2C portion of our business. Our cash conversion continues to remain healthy. OCF to EBITDA is at a healthy 86% for H1 FY '21. We have seen tremendous response through our digital engagement activities, which has seen a steady rise in website traffic, call volume and home visit. It continued to strengthen our existing IT systems by rolling out new and improved updates to the existing system like in-house support for digital platform, improved health data analytics and securing information systems through continuous monitoring. Our near-end targets include consolidating our cloud infrastructure and providing robust end-to-end support along with data privacy. We are also in the process of highlighting partners for long-term digital transformation in B2B and B2C. While customer focus is key at Metropolis, other important stakeholders are also an important part of our ecosystem. We have spent considerable time during COVID-19 to rope in and introduce new doctors to the service network. New hospitals and labs have gotten added. And all this will help us create deeper inroads in the end markets. Our efforts in testing during COVID has got us tremendous engagement opportunities with government and decision makers, allowing us to play a more meaningful role in the Indian diagnostics journey ahead. And lastly, increasing employee engagement efforts to digital training models, thereby increasing new benchmark of performance. Let me conclude that we are going through a strong path of growth for non-COVID revenues, coupled with healthy margins and a strong balance sheet, a capable and highly technical team that has stood the test of time in the last 2 quarters and created a stronger Metropolis brand. That's all from my side. I would now like to hand over to Vijender to take you through some of our operational parameters.
Thank you, Ameera, and good evening, everyone. Let me give you a perspective on our operational parameters. For Q2 FY '21, we reported patient visits of 2.62 million, registering a marginal growth on a year-on-year basis. We conducted 4.83 million tests versus 5.2 million in Q2 FY '20. Revenue per patient and revenue per test increased on account of high-value COVID-19 test. On a like-to-like basis, non-COVID revenue per test and revenue per patient stands at INR 926 and INR 444, respectively. This meant a growth of 8% and 3%, respectively, on a year-on-year basis. This growth has primarily been attained on the back of volumes returning from high-value specialized test.As guided in previous quarter, we had announced a onetime rationalization exercise. To this effect, we have continued our rationalization exercise of the bottom pyramid of the network, which was counterproductive in our overall scheme of things. This onetime exercise has largely ended in September 2020 and will lead to better productivity and efficiency as well as improvement in management bandwidth. Our revenue profile among focus cities and other cities stood as follows. Focus cities, 5 cities, including the city and peripheral area around metropolitan regions, contribution has moved up marginally from 56% in Q2 FY '20 to 57% in Q2 FY '21 on back of increased testing requirements from urban cities. Seeding cities, 8 cities including the cities and peripheral area around the region contribution has moved from 19% in Q2 FY '20 to 21% in Q1 FY '21, while the other cities contribution has moved from 25% to 22% in Q2 FY '21. Our B2C revenues in focus cities in Q2 FY '21 for non-COVID business has now reached 60% as our brand continues to gain more traction. This has been a measure of our efforts to focus GP on ensuring standardization of service levels across touch points, consistent doctor and patient engagement, focused marketing efforts to all stakeholders and ensuring convenience in delivering diagnostic services through increased home testing services. With respect to the mix on volume and value basis, including COVID-19 tests, which are part of specialized test, the volume and value mix for specialized tests has been an improvement. We continue to increase our non-COVID revenue while focusing on increasing our utilization levels of our collection and lab network. While our aim is to grow our non-COVID revenue, the overall revenue growth will also depend on how COVID shapes up, which is difficult to predict as of now.However, as September has panned out, we believe non-COVID revenues will rise faster as situation normalizes across the country. Our capabilities on testing on the back of largest test run ensures faster penetration of Metropolis brand in geographies will enable us to outperform. I would also like to highlight on our HR initiative. Ours is a people business and hence we believe it is our duty to keep our employees motivated and happy. In addition to the revision of salaries that Ameera mentioned in her speech, we've also taken a number of initiatives, which includes the MD Shaurya Award for the frontline staff with personal contribution from Ameera. ESOPs are part of senior management team. Further, we have constituted an employee welfare fund as well as reoriented all the insurance schemes, along with medical testing and provision of medical assistance for employees and immediate family. That's all from my side. I will ask Rakesh to take you through the financials.
Thank you, Vijender. Good evening to everyone on the call. Let me give you a snapshot of our financial performance. Happy to share that we have been able to surpass our own expectation that we laid down during our last update. On the revenue front, we have been able to scale up revenue from INR 68 crore in June 2020 to INR 105 crore in September 2020. The revenue growth was strong on a month-on-month basis. COVID contributed to 35% to Q2 financial year '21 revenues. While COVID revenue remained elevated in July 11, it tapered down in September 2020 wherein we saw higher growth in non-COVID revenues. Accordingly, we reached full recovery in revenues on non-COVID PCR front and believe this trend is sustainable and will remain our focus area while fulfilling COVID testing and subsequent revenues. We have achieved record EBITDA in quarter 2 financial year '21 with margin of 32.9% before CSR and ESOP. The levers for this margin include increased utilization level and superior product mix, which led to higher throughput at our lab; higher home visit tests, which now stands at 20% for Q2 financial year '21 B2C non-COVID vertical; cost optimization efforts on back of automation, digitization and innovation led mindset in our way of doing business. As guided earlier, our efforts would be towards increasing non-COVID revenue and therefore it is difficult to predict Q3 outlook given the unpredictable nature of COVID-19 volumes. Having said that, we are confident to grow on Y-on-Y basis on non-COVID tests. However, with partial rollback in cost-saving initiatives, as we have guided in Q4 and Q1 calls earlier, we expect some marginal moderation in EBITDA margin going ahead For Q2 financial year '21, our revenue stood at INR 289 crore. Q2 financial year '21 EBITDA before CSR and ESOP stood at INR 95 crore, and margin stood at 32.9%. For H1 financial year '21, our revenue stood at INR 431 crore, a growth of 1% on a Y-on-Y basis. H1 financial year '21 EBITDA before CSR and SOP stood at INR 107.8 crores and margin stood at 25%. Our PAT for the quarter stood at INR 60.5 crore with a margin of 21%. For H1 financial year '21, our PAT stood at INR 63.4 crores. We have continued to focus on collection efficiency. Our debtor days has improved from 55 days in March '20 to 49 days in September '20. Overall working capital days have improved from 11 days in March '20 to 4 days in September '20. Our liquidity portion remained very strong with INR 325 crore as on September 2020. OFC (sic) [ OCF ] EBITDA stood at 89% for H1 financial year '21 versus 86% for H1 financial year '20. Recently rating agency reaffirmed its CRISIL AA-, that is, stable rating on the nonconvertible debenture and the long-term loan facility of the company, and has also assigned CRISIL A+ -- A1+ rating to the short-term bank facility of the company. That's from my side. We now leave the floor open for Q&A. Thank you.
[Operator Instructions]. The first question is from the line of Anubhav Aggarwal from Crédit Suisse.
One question was, on the home testing that you mentioned about 20%, just wanted to understand in your network some of the home visits will be captured to the central, let's say, your lab versus on a service network. What -- I mean just wanted to understand what percentage of home visits will directly be serviced by the central lab?
We can't hear you very clearly, Anubhav. Your question was what percentage of visits...?
What percentage of the home visit will be captured by the central lab versus, let's say, captured by your franchises?
So majority of our home visits are done directly by the company. Minority will be done by the franchisees. One of the key things that we are trying to accomplish is sort of an operational standardization of experience. And therefore the expansion also that we are doing in terms of the home services to many more cities will be primarily done through a direct model versus through a franchise model. Having said that, the direct model does not mean additional costs on the P&L, as we are doing it through a semi [indiscernible] model.
Sure. So that's the reason you mentioned that margins are higher for home visits because you don't have to share margins of the franchises there?
That's one of the reasons that gives obviously a better margin.
And the second question was on the service network. After the, let's say, reorganization, restructuring this service network, you have about 2,450 centers right now. When you think about this, let's say, over the next 2 years, 3 years, what kind of number you're thinking about? I'm just trying to get a direction. Would you be like less than what you are today? Or would you be like 3,500 or 5,000? I mean what kind of number you're thinking about let's say 2, 3 years down the line?
Sure. So I think in H2, we are looking to add about 150 centers, which has already begun the expansion. And I think in '21, '22, we are looking to add about 600 to 700 centers. I think the general trend will be to continue to expand, 600 to 800 centers per year. It could be a little bit more, a little bit less, but that's the approximate range. So we will continue with our brick-and-mortar expansion. We do not believe that, that is going to any way compromise. As we said, rationalization exercise that we did from April to September was a onetime rationalization and consolidation after 3 years of expansion just to maintain hygiene in the system. And we have already now finished the rationalization and started our expansion again.
The next question is from the line of Chandramouli Muthiah from Goldman Sachs.
The first question is a slightly broader industry question. In recent weeks, industry participants have pointed to COVID testing potentially being a recurring business line over the next quarter and beyond. But with increasing optimism around potential approval of a COVID vaccine, how do these developments influence our strategy for COVID testing business going forward?
See, our view has always been, and you would have noticed, that Metropolis probably has not been extremely vocal on COVID being either a big driver of business or not because at the end of the day we believe that this is not completely influenced by us. As you know, pricing is influenced by the government; volumes are dependent on cure and therapy and vaccine. And therefore we have sort of kept a neutral stand quarter to quarter. Having said that, as you have seen, what we just announced, we at Metropolis have done the maximum COVID PCR business in Q2, which has just gone by, compared to any of our peers. So I think -- going forward, I think regionally we see a changing pattern of COVID. In parts of West India, we are seeing COVID infection fall currently, but that doesn't mean what's going to happen in November, December, we don't know. But in October and parts of November, we saw it fall, but we saw it increase in other parts of the country. So I think regionally, you will continue to see highs and lows in different parts of the country, and depending on which market we are strong and we will be able to absorb that opportunity or not fully. So I think the COVID opportunity continues to be alive. But it will be unpredictable in its lack of consistency quarter to quarter as it will come in different geographies. Also as the vaccine comes to market, antibody testing and PCR testing will again become very relevant. We don't know what the effectiveness of these vaccines are practically yet. And people who get the vaccine will again need to check whether they have got the antibodies or not, along with also people who continue to get infections as things open up. So yes, the opportunity is alive. We continue to expect it to be there many quarters to come.
Got it. That's helpful. Second question is on the margin line. So could you talk us through what the different factors are in this 400 basis points leap? I think we've been doing pre-COVID close to 28% range, now it's at a 32% range. As business trends move towards steady state, do we think some of this margin expansion we've shown is sustainable. I understand our wage costs may step up starting in 3Q. We did 28.5%, I think, last year in 3Q. So do you think a 30% margin range is something we can aspire to on a sustainable basis?
I think there were 3 things that really contributed to the margin expansion. One is the factor of the company's scale, obviously having growth of about 29 -- or 30% growth with the same -- similar fixed costs and similar variable costs have also added to that. That's the number one point in terms of the margin. Number two is the change in mix of channels. As we alluded to, our home visit channel has gone up, and we believe the way we are building home visit has a better margin profile. And what we will continue to do and therefore that has aided with the increased ratio of B2C through home visits.The third, I think, has been really good work done by the team in terms of cost management, not only on manpower cost, where there has been a lot of productivity done, but also on using digitization and automation, as we have been indicating for the last 3 quarters we are going to do, to really help streamline not only manpower productivity but other costs as well. And therefore, we are seeing some of those benefits come to play in the cost management as well. We believe that most of these costs that we have reduced will be sustainable. There will be obviously certain things which in the long-term interest of the company are advisable to do like obviously giving wage increases and things which are normally required.
Got it. Got it. That's helpful. And just one housekeeping question. If you could share with us the RT-PCR and antibody testing revenue split and volume numbers, please?
So the antibody question for us is a smaller component compared to the PCR testing. And we have found that the antibody and antigen testing is about 3.5%. Rakesh, you want to comment with some more information on this?
Yes. 3.5% is right. So we have done 3.5% of antibody and antigen test. And rest of the test are basically RT-PCR. So RT-PCR number percentage 34% to 35%, yes.
Got it.
We continue to see this as a big opportunity for Metropolis going forward on the antibody side.
The next question is from the line of Bharat Sheth from Quest Investment Advisors.
Congratulation on excellent set of numbers. Yes. I have just one question. This PCR testing, the patient which has been tested COVID positive, so there are a lot of tests associated with it, which could be of a onetime nature. So can you give some color on how much is that and which may not be repeated once the COVID is out?
See there are certain tests which are not only for COVID, which are for many different infections and diseases. So for example, there is a test called D-dimer, I think which is what you're probably referring to, which is actually an indication of whether there is any potential heart disease followed by COVID. Now these tests obviously are prescribed not only for COVID but they are prescribed from any different infections or disabilities or illnesses. So these are what we are calling as COVID rub-off tests. And there is a group of such tests which are getting prescribed more during COVID, but they were getting prescribed even before COVID. So we don't have a separate quantification for that because it's very difficult to determine what is being prescribed only specifically for COVID or for other reasons. And therefore, we only look at the COVID antibody and antigen separately along with PCR. And those go into the non-COVID bucket.
Any color directionally if you have that kind of a test gone up substantially during Q2 because of COVID?
They have gone up significantly, yes. I don't have the exact quantification for it. But it's not a very large number that makes you feel that if COVID drastically falls, then that entire revenue is going to get wiped out. It's not a very big percentage.
The pie which is there for these tests are very small in our overall numbers. So it's not a very big pie for us. Obviously, the number may have gone up, but still whatever number has gone up, that constitute a very small pie in the overall business. It's a very low single-digit kind of a number.
Okay. And second question is with this now opening up a whole, I mean, lot opening, so what kind of, I mean, unorganized to organized opportunity we are seeing? And what kind of offer are we getting for consolidation or merger and acquisition?
Sure. See, unlike some other industries which are very heavy laden with debt and therefore you are seeing a lot of distress sales happening, that is obviously not the case in health care. The entry barrier in this industry is very small and therefore we don't generally tend to see people who have got too much of debt. What we are seeing is that actually there are sort of 3 levels of labs, and I'm happy to run through each of them. The bottom level is where you have got almost 99% -- 95% of the industry or you could say 90% to 95% of the industry are sitting in that market, which are the independent mom-and-pop labs, of which majority tend to be run by non-medical people, and very few, only 10%, are run by pathologists, right. Now in those laboratories, anyway, they were not very compliant, their cost base was very low and they didn't have any costs. And therefore we are seeing that while they continue to struggle, obviously health care being largely defensive, they have come back to about 60%, 70%, 80% of their normalized revenues compared to the year before. And therefore, they are making less profit, but they are not under some very heavy stress on loans that they have to sell. Also these tend to be very, very small. They tend to be INR 1 lakh or INR 2 lakh per month kind of revenue. And therefore, obviously, these are labs which we have no interest in buying. We then have the second layer of labs, which are the regional players, which have actually grown and become strong in 1 city or in 2 cities or 5 cities in a particular geography, in a particular region. Now like this, there are only about 10 to 15 such labs all across the country. And therefore, there is -- they tend to be very scarce. Some of them are not built in a good way. Some of them are built on heavy discounting, bad practices, and we have obviously very little interest in buying. The good quality franchises -- the good quality business franchises have been built on good practices, good quality of business, and those are very few. So obviously we continue to evaluate any such opportunity that comes our way. And as I indicated in the speech, we are very open to doing also mid-size or large-size acquisition. And we continue to explore all such opportunities along with smaller acquisitions as well.
The next question is from the line of Chetan Gindodia from AlfAccurate.
Congratulations for the very good set of numbers. Ma'am, my question is with respect to our EBITDA margins. So I understand that with the operating leverage benefit and the cost savings, our EBITDA margin has gone up in this quarter. So when this COVID revenue is gone, say, it comes down over the next 2 years, so can we -- and non-COVID revenues against scales up, can we expect the industry -- overall industry margin and your margin also to move up to the 30% kind of a bracket?
See industry, there is no such thing as an industry margin because every company has its own unique business model. And therefore depending on their product mix and depending on their channel mix and the quality of business that they do, how much they discount, if they don't discount and what are their prices, each person's EBITDA margin has a different potential. So it's very difficult to comment on anybody else. But if I can comment on Metropolis alone, we believe that if tomorrow COVID -- next year COVID is not there at all, you have already seen us having historical EBITDA of about 28 -- between 28% to 29%. And we believe that if we are able to execute the things that we are looking to execute, there is potentially an upside in terms of margin profile. Whether we will want to continue to just build margin or reinvest that margin into better growth opportunity, I think it is a decision we'll make at that time. Maybe we'll continue expanding the centers aggressively because we are already at a good margin. So we'll take that decision, I think, closer. But yes, definitely, if we are able to execute what we are planning, there is an opportunity for a margin upside.
Okay. Okay. And just a follow-up on that. So is it safe to assume that our current fixed cost structure and our current facilities can support a much higher level of non-COVID revenue?
That is right. I mean we have seen, for example, our existing infrastructure support an additional 40% growth just in the month of -- 45% in growth in the month of September through the same infrastructure. So I think that should indicate that the answer is very clearly yes.
The next question is from Anmol Ganjoo from JM Financial.
Congratulation for a great quarter. I have a couple of questions. One is that when you guys characterize COVID revenues, are you also taking into account the associated test like D-dimer or they would be classified under non-COVID revenues?
It would be when we are talking about COVID PCR revenues, we are only talking about COVID PCR, not any other test.
Okay. That's helpful. The second question is around home visits. So the B2C revenue comprised of around 20% of home visits this quarter; 19.6% is what you've put in the presentation. What did this number look like either previous quarter or the corresponding quarter last year? Any color on that?
I think it's -- Rakesh, it was 14.5% last year, right?
Yes. So yes, Q2 last year is 14.5% from where we have moved to 25% this year. I'm talking about retail B2C.
Okay. That's helpful. Third, Ameera, if you could just throw some light on vectors of realization growth because one is, obviously, home visits are higher realization. So is COVID. But what's happening on realizations in the portion of the revenue, which excludes that. What are the opportunities in terms of pricing given people's reference for higher brands and you guys also enhancing the experience? If you could shed any light on some of the more sustainable vectors of pricing growth or realization growth, that would be helpful.
Vijender, do you want to take that? Vijender?
Yes. Anmol, can you repeat the question?
So I was just trying to understand what are some of the vectors of realization? Because we've seen fairly healthy realization. So one, is obviously COVID and the other is home visits. But if you could just throw some light on how this looks like for next 4 quarters or more sustainable trends there, that would be helpful.
Yes. Yes. So I think overall if you see last quarter 1 versus quarter 2, home visit services have definitely given us a big spike. And accordingly, we have done our capacity -- capacity is sprucing up as well. So this is going to continue. And from a strategic point of view also, we want to really invest behind this home visit services. And beyond that, in order to make it much more robust, we want to also add a little bit more features to this, not just for diagnosis, but something related to other pieces also from wellness point of view. So this is going to continue in our next year strategy as well. But, important here is that we've seen in quarter 2, there has been a good traction on the footfalls as well. So that is what Ameera also mentioned that in H2 we plan to add another 150 centers. So frankly, these 2 things are going to be our key strategic points: home visit and then number two is opening up of centers.
Anmol, just to add to that, if you see our -- even keeping aside COVID, our revenue per patient has increased about 8% from about INR 850 to about INR 925 approximately. And this is not including COVID at all. What we have seen is that the mix of specialized testing has come back to about 39% in Q2, which was obviously lower in Q1, and approximately the same percentage contribution it was last year as well. So as the specialized work comes back to normalcy, we hope that the realization for patients will get benefited by that. But obviously, as we have maintained before, our goal is not to keep only increasing the realization for patients, but actually also to get enough volume through the system. So it is a fine balance between, like you said, our EBITDA margin economies of scale, operating leverage that we get and reinvesting it into growth. And at the same time, the expansion that we get in revenue per sample and reinvesting it into volume. So the idea is to maintain that healthy balance between the 2 and not just focus on any 1 KPI to keep maximizing only profit or only revenue per sample.
Okay. That's extremely helpful, Ameera. One last question before I get back to the queue. So you spoke about that there are not enough targets because of the fact that you guys are choosy in terms of what you will pick in terms of an asset. But have we seen that last couple of quarters of disruption has at least pushed the organic market share of the long tail that the industry has to you? And in that sense, are you guys growing faster than the industry? Because I can't imagine that such a period of disruption for the industry won't be beneficial to you guys. I can understand that there might be assets that you might not want to pick up because of hygiene reasons and other fitment reasons, et cetera, but is there a greater acceleration of market share shift than what we saw same time last quarter, for example?
No. I mean, I think what the feedback we get on the ground and common sense, so like you rightly said, there is definitely a move of people moving from unorganized to more organized brands like us. Having said that, unfortunately, there is no hard data available on the industry from any third-party provider that allows us to validate that in any quantifiable way. So while I can tell you it is what we are seeing on the ground, but there's no robust data points to back that up. But what we hear from our teams is, yes and also obviously there have been only about 200 labs across the country, out of 100,000, which has had the capability to do COVID testing. And with the heightened visibility that COVID testing has gotten, it's very natural for consumers in their mind to separate now labs who have the advanced capability of doing COVID versus everybody else. So I do believe that there will be a natural move to these, but whether it's already happened and at what pace is very difficult to know.
The next question is from the line of Praveen Sahay from Edelweiss.
Many congratulations for a good set of numbers, and the award you guys has received. So my first question is related to the volume. Like, as I can see in the presentation that the September month, the sales grew by 6% non-COVID business. And so -- and also in the last quarter, we had observed that realization has improved significantly. So how is the situation right now in the month of October? Will that -- our volume is back to normal? Or still we are in degrowth?
So can't obviously comment specifically on October numbers at this point. But overall, we see a trend of non-COVID business continuing to grow quite well. Obviously, there will be seasonality factors which will come in in this half of the year. There will be some months which have more festivals and holidays and some months which have less, which is quite typical to our business. But generally, the trend is that non-COVID business is increasing. Again, it depends on state by state. There are some states which have never ushered in a very strong lockdown. And there things were normal from day 1. And therefore, we never saw such a slump in business like in Q1. But like there were some states which actually completely shut down their state and therefore that became a psychological barrier for people to step out. So I think region to region we are seeing a different reaction. But overall, the trend is that non-COVID is definitely increasing. Volumes are increasing. And is it 100% normalcy everywhere? No, but generally that is the trend.
Okay. And second, on the rationalization. As you had mentioned, this is a onetime rationalization effort in the 3 years of expansion, so how old these centers in the system which we are closed?
Vijender, do you want to take?
Yes. So these were primarily last 2.5 years average. But these are generally the centers which have been -- which were opened in other city categories, which we call as ARC. So these ARCs operate from smaller towns, and we thought that it's good that we should sort of rationalize those centers who are not completely loyal, who are not following any specific protocols of the company. So it was spread over last 2.5 years centers average point of view.
Okay. And last question is related to the seeding city contribution, which has now picked up to 21%. So can you give any directional comment on this? How much of the target contribution you are expecting from these cities in the next 2 years or 3 years' time?
See, if you look at it we have 3 categories of cities, one is focused, where there are 5 cities in this category. And our -- one of our endeavor has always been to increase our B2C ratio in these cities. And what we shared the data in Q2, our B2C ratio in these cities have reached to 57%, if I include COVID. If I exclude COVID, then the contribution is about 60% of B2C. So this probably is going to be our key focus area. And in future also we'll continue to improve the B2C ratio in these cities.
But the seeding city, how much -- that 21%, you continue to do so. That's -- because that's I think there B2B is a focus area or contribution is higher. So how is that going forward?
No. No, I think important for us would be to look at focus cities where our contribution is high. And from B2C's point of view it's good that we focus in focus cities for B2C. On seeding cities, we have 2 different kind of markets where there are certain markets where our B2C contribution is high. There are certain markets like north in the Delhi or Calcutta where our focus has been more on to B2B side, which will continue to move. But definitely, going forward, we want to -- as I mentioned, just in one of the questions that we want to really invest behind home visit. And these are the markets where, I think, home visit will create a platform for us to get into B2C area in these markets.
The next question is from the line of Neha Manpuria from JPMorgan.
Ameera, on the home health care business that you are planning to invest in, is there an opportunity cost on the volumes that we get on this business? While I understand that because we're doing it on our own, the profitability might be higher, but wouldn't these volumes ideally be a walk-in into your franchisee centers and therefore more a cannibalization of growth rather than new volumes? Or am I looking at it the wrong way?
Yes. I think in health care business, there was -- the way we see the business, if you -- like in other industry, you may categorize and say these are brick-and-mortar traditional and then there are new age companies. In health care, my strong belief is that there is not going to be this division at all. There are going to be some health care companies which move towards being new age, which means being more asset-light, being more digitally mature, knowing how to handle an omnichannel strategy and most which will actually not have the ability to make this transition. And the one -- those of us who are able to make this transition will be able to capture new consumers new customer profiles in a strong way, but both models will continue to exist. So there will continue to be the traditional brick-and-mortar approach, which is going to continue to be majority of health care business. And then on top of that, there will be this more new age digital/home services which will come on as an extra piece that will get added on. Now will there be cannibalization between the traditional and the new? There is bound to be some amount of cannibalization, like there has been in other industries, be it retail or something else. But the opportunity cost of not doing it is far worse than the opportunity cost of doing it. And I think overall, if we look at these 2 together, we believe that we will continue to expand our market share and expand our brand in the mind of the consumer. And thankfully not in a fashion where we are losing margin but in a fashion where we are gaining margin. So in our mind, it's a must versus an optionality.
If I want to extend the question a little bit, given that some of these regional players have become particularly strong during COVID with the large increase in revenues that they have seen, the unorganized to organized shift, could there be a case that they benefit more than the large players do? And the second part of the question is how difficult is it for a regional player to scale up home health care? Or do you think the digital piece of it makes it a bigger tool for the larger players than the regional players.
That's a good question. Look, I think the regional players which were already strong in certain cities have definitely benefited during COVID. So whether they have benefited more than the pan-India players or less is very difficult to gauge because obviously these are all private entities, which we don't have access to information. But they have definitely benefited like we have benefited. Do they have the ability to roll out digital/home services? Yes, they have the ability. The question is do they have the right management teams and do they have the right mindset. And I think the fundamental issue that we have seen with any of these companies who have tried to scale are [ various ] challenges. The biggest challenge is that most of these tend to be doctor-led and managed. And therefore their ability to commercially scale up as a business, the systems and processes tends to be maybe not as strong and therefore usually are not able to cross borders and move from the city that they are strong into new cities. So they land up making a lot of profit in their core cities but don't necessarily have the ability to scale from a geography perspective. They might have gotten stronger in their own city, but I don't see them necessarily having now the ability to become regional or to become pan-India.
The next question is from the line of Susmit Patodia from Motilal Oswal.
Ameera, a couple of questions, if you don't mind. First is, I was just thinking about, when we speak to a few insurance companies, they are now saying that COVID test is a test that they are also getting done. Are you seeing business coming there? And is that a stream of revenues that you think can be sustained?
I think mostly insurance companies are doing it in behalf of -- in some cases, TPAs are doing it on behalf of the corporates that they are tied up with or in some cases, insurances are doing it selectively. So far, we have not seen this becoming a significant source of revenue. Corporates, yes, which has become much larger than before. But insurance companies specifically, we have not seen it become a very large group yet.
Okay. And secondly, just from a thought perspective, do you think about new tests which can become 5%, 10% of your revenues 3 years, 4 years down the line? Like we see this with consumer companies thinking about new products becoming a certain percentage of revenues down the line. If you can tell us how you think about this -- or first of all, is it relevant in diagnostics?
We see certain products definitely gain traction. There's usually never a black swan event that's happened like COVID that has just taken 1 product to the top of the list, like it has in the last 6 months for any diagnostic firm. Traditionally, what happens is a test takes long time to gain acceptance among doctors for them to start prescribing for their patients. It's a few years' journey, not an overnight situation. And therefore, the same reason, it's difficult to deploy those tests from the top list of -- the topper list. So we expect to see COVID definitely as a topper, I would say, for a few quarters to come. That version of COVID may change. For example, today, we are doing a COVID PCR; tomorrow if saliva-based test comes, which is of a different technology, that may replace the COVID PCR. But COVID as a product, we definitely expect it to continue to top the list for a few quarters.
Right. Okay. So you don't think internally about developing a new test, which can become...
We develop tests all the time. So it's not -- we talked about -- yes, we develop tests every quarter, but what I'm saying is that those don't move to the top of the list in a short span of cycle.
Not the top. I mean 5%, 10%. Okay. Got it. Got it.
Yes, yes. Even -- they don't even become 5%, 10%. They'll stay a very sort of small percentage of the revenue. If you look at the 4,000 varieties of tests we do, your top 30, 40, 50 tests will contribute a significantly larger part in your revenue compared to the tail end of your tests.
Got it. And the third question, now that you're on the expansion path again on these service centers, if I were to see your '16 to '20 journey, your centers were up 60% CAGR and your B2C revenues were up 20% CAGR. Is that a fair proportion to think about when you expand, let's say, 6x in the next 5 years?
I'll give my comments and Vijender can add to it as well. Usually, there is a gestation period for a center to start breaking even and making money, whether we set it up or other franchise sets it up. Usually, we see about 1 year to 1.5 years as an operational breakeven period for a franchise when they set up a PSC, patient service center. And obviously, that's assuming that it happens in a focus city where Metropolis brand is reasonably strong. And then it takes about almost 4 to 5 years for it to come to some sort of maturity. That is usually the gestation period because when you set up a center, it's not a pure OTC product. You're actually going and then going to all the doctors in the area and going and trying to move them from the unorganized players to your brand, in a systematic way. And doctors who've had relationships for 30 years and other labs take their own time to move. You have to also create a visibility in that area with your patients. And therefore, while you may set up the distribution in an expansion phase very quickly like we did, it doesn't mean the revenue will flow at the same percentage, but they will definitely take a longer time to flow. Like I said, maturity is 4 to 5 years.
Right. So I mean, I just wanted to understand that if centers go up, let's say, 6x in 5 years, the top line should go up at least 2x to 2.5x in that 5-year because that's been the track record for the last 4 years.
That's in the track record, yes. Vijender, anything you want to add to that?
No. I think way forward, definitely a company like Metropolis is going to get leverage or benefit primarily because now people are more aware about hygiene and safety. And our strategy on this expansion basically talks about going closer to patient. Now during COVID, why it is important because people may not like to travel to far distance. Of course, they would have an option of home visit, but of course they can also visit to the nearest outlet, which is like the kirana shop. So I think going forward, definitely, this is going to help us a lot in terms of going closer to patients.
Right. And just last question before I get back in the queue is any thoughts on radiology? Has anything opened up because of this crisis? Any change in that -- towards that segment?
I think nothing which is a significantly long-term opportunity. I think short-term, radiology centers who obviously demonstrated an ability to be safe and hygienic during the COVID crisis gained over the unorganized because it's so driven by a sort of brick-and-mortar and it's not as scalable as pathology in terms of home services, et cetera. But the general mindset around radiology continues to be the same, which is on high-end radiology, which is on PET scans, on MRIs, on CTs, but we don't like the financial profile of the business. We don't like the hygienic/unhygienic practices of the business. We are okay with the low-end radiology, which is x-rays, ECG, et cetera. And that is an area that we may continue to explore, as we already have in many of our centers, and we may continue to expand.
The next question is from the line of Rahul Agarwal from InCred Capital.
Just to start with a few clarifications. The realization for non-COVID, which is 925, essentially includes antibody antigen test is it?
Yes. When we separate out COVID but of course, antigen and antibody tend to be much lower. Usually, antibody tests realization is much lower than this, including antigen is much lower. So if anything, it decreases the average realization, not increases it.
Okay. Okay. And secondly, when Rakesh said, about 3.5% being antibody antigen and 35% being RT-PCR, I didn't really catch that number. What does that really mean?
Rakesh, you want to clarify?
So basically what we are saying is whatever revenue we are projecting for Q2, that revenue constitute 35% of COVID PCR revenue and 3.5% of antigen and antibody revenue.
Of the total sales reported?
Yes. Revenue reported, yes.
Okay. Perfect. And okay. So my first question now essentially is, as Ameera mentioned on the growth driver going forward, I just wanted to delve a bit deeper on that. Could you help me understand within the focus and seeding cities, which are the markets where you think the growth would definitely be higher in terms of next 3 years, if we take that kind of horizon. Could you help me understand how will Metropolis look in terms of test mix or a share of B2C on the overall business, not in focus cities and wellness, just a broader picture of the company overall over the next 3 to 5 years will be really helpful.
So on the B2C part, as you know, the KPI that we always look at is B2C in focus cities because looking at it overall in the business depends a lot on what the contribution of other areas are. So that we see as a long KPI to follow. So I'll continue to tell you the B2C in focus cities. As we have said from day 1 in our pre-IPO as well, that our goal is to get to 65% of B2C in focus cities. We have, as of this quarter, reached 60% and we started [indiscernible]. So we think we have come with a very great progress on this, and we'll continue to march forward with this goals. We will expect to see focus cities growth on B2C, continue to be pretty positive, and we will also expect seeding city to be positive. If you look at focus cities again, because of parts of B2C and B2B, when you focus on B2C, you're naturally saying that B2B is not necessarily going to give you as aggressive a growth in that particular focus market because not necessarily, but sometimes, they tend to be price conscious with each other. So in focus cities, the goal is definitely B2C growth, which will be the area we will really prioritize. In seeding cities, it will be the overall growth that we will prioritize, and we hope and consider to see that both of these will continue to have similar percentages that they do us now because we are also seeing the other cities, which is off a low base, are also growing quite aggressively. So just a matter of arithmetic, we don't expect to see a drastic change in as a contribution you see now. 2 to 3 years from now, we don't expect to see a drastic change in any of the contribution metrics. As far as the test product mix, similarly, as you see, our routine semi-specialized and specialized have been going in a certain direction, and we expect that will continue. We expect the semi-specialized to keep moving downwards, but not in a hockey-stick approach but in a very gradual move down, and we expect to see routine and specialize in a gradual move upward. Vijender, anything you want to add to this?
Yes. I think you're right. When I see, overall, if our B2C ratio goes up in focus cities like Ameera said, but in 2 years from now, we wanted to be at 65%, that automatically will change the whole B2C ratio at group level.
Right. Got it. And lastly, if you could give some kind of direction on the non-COVID business for the second half, as in, could we see like 15%, 20% Y-o-Y growth? Or we see like more like single digits?
I mean if you look at our historical things before COVID happened, you'll see that our '18 -- '17/'18, '18/'19, our growth was 18%; '19/'20 was obviously impacted by the last fortnight, but we were on trend for about 16% non-COVID. And I think we were reasonably comfortable with those numbers. So I don't see any reason why it should fall to a single digit growth.
The next question is from the line of Bharat Shah from ASK Investment Managers.
Yes. Bharat Shah from ASK Investment Managers, just to correct. 2 questions. One, some kind of a shape of an emergent integrated health system probably is beginning to emerge, whereby, let's say, all the players in the health care system kind of get linked together. So whether hospitals, nursing homes, then the medical fraternity doctors and the fraternity, diagnostic chains like yours, medicine dispensers and insurance firms. Now B2C brand-driven business, more profitable, consumer oriented, builds equity without any question. But over a period of time, aggregation of the health chain as an entire system would make it inevitable for many different constituents to play along. Any thoughts on that?
Sure. Look, I don't disagree with you. I agree with you that over time we expect to see a more integrated approach in health care where all departments and stakeholders of the ecosystem ideally should come together. What I'm actually seeing is the government is actually driving the agenda through the National Digital Health Mission, of which I'm a part of the committee as well, of really being the super highway which connects all the different stakeholders in the ecosystem, at least from a perspective of storing data and keeping an interoperability of data when a patient moves from X hospital to Y hospital or goes from one diagnostic center to the other. And I think if that happens, and the government becomes a key storage in charge or at least the platform in charge of allowing a consumer to control and own their own data along the way, I believe this will be a good move because it will make life easier for the patient and easier for the doctor to make a clinical decision. Now that's one piece of it.The second piece that's happening is there are a bunch of players who are trying to create health platform for the consumer and the patient to say that, look, we will help you through your record, we will help you to your doctors, et cetera, et cetera. While that is an aspirational project, on the ground, we have not necessarily seen that take off in a huge way. While teleconsultations did increase in the last 6 months, the kind of teleconsultations that increased were mostly Zoom calls that doctors did from their own telephones with their own patient bases. Teleconsultations through third-party platforms have not gotten as much traction. And even if they have, they have not necessarily become revenue generators, but they have become more sort of free feature that consumers are using because they have the opportunity because platforms are providing it. So whether this marketplace is going to go on to become something that changes the consumer and doctor behavior, frankly, is too early to tell at this point in time. But the integrated approach of health care players coming together to what the government is trying to do and through free markets will definitely happen. I hope that answers your question.
Sure. No, my -- and that's exactly the point I was kind of making that this National Digital Health Mission seems to be the first attempt to kind of aggregate. First of all, data pieces are loose. With the new intelligence, you bring them together, you store them, create systems, make them interoperable, and then the first signs of a more sophisticated system which can link everything can emerge. So it was basically from that perspective. So yes, that does answer. Second, technology increasingly will not just be the bread and butter and converting routines into efficiency or the ease. But it will be not just a business advantage or a competitive advantage but may become inevitable and a significant differentiator. So from that perspective, artificial intelligence, data science, data analytics, again, an emergent project, nothing in the immediacy but over a period of time, unless one thinks about it today, those kind of things will take longer time tomorrow to shape up. Therefore, predictive diagnostics, greater capability to engage and create a true brand equity, your thoughts on that?
Absolutely. So there's again 2, 3 pieces of it. And there obviously a lot of interesting concepts but some of them also will end up becoming buzzwords and they are trying to make sure that we differentiate between the buzzwords and what we genuinely believe will help us do better in our business. So there are 2 areas that we generally believe will help. One area is creating this digital ease from a patient and consumer perspective, right, and how do you create engagement. Like they have in other factors for further life, be it retail or be it banking or be it telecom or whatever else, and how can we create that ease of working with Metropolis and engaging with us, so that's number one. The second is the other stakeholders in the ecosystem, how can we make life easier for them to engage and therefore makes them more [ attractive ] for the proven Metropolis brand. I think these are very clear opportunities. Now on the back end, when we talk about artificial intelligence, if you talk about machine learning, these are good concepts, but the question we have bring is, where is the advantage. Now tomorrow can we use the data and the knowledge base that we have harnessed as a group and use it to improve the quality of clinical diagnostics that we are doing, using artificial intelligence? Absolutely, it's possible. Do we have the data sets which are ready? Do we have the knowledge base which are ready? The reality is there are no companies which actually have it; they have to be built. So while we do have some amount of data on the back end, you don't necessarily have the pathologist who is today sitting and looking at reports and deciding whether, okay, this is a positive or a negative or a normal or abnormal, how do you capture that pathologist's knowledge and put it into a computer and enough data of that and therefore create artificial intelligence. I think it's a journey that all of us will have to go through as diagnostic players. What is the end goal of that? The end goal of it is that are you able to reduce your manpower cost on pathologists and be able to replace it with AI. Today, if you look at the cost of pathologists as a percentage of our total cost base, which is not very significant, and therefore I'm not sure whether this particular thing from a productivity basis is going to impact us in a large way in the long term. From a quality of diagnostic basis can it help? The answer is yes. So there are efforts on our side to work on some of these projects, which we believe will be slightly more mid to long term. But the work has already begun in terms of what we are working on at the back end.
Sure. No, because artificial intelligence, while the label is stuck, but it's increasingly becoming more synthetic rather than remaining on the artificial. And to that extent, I think the strides being made are probably faster than one may wish to acknowledge. The last part is more mundane. Were any of our technology systems were attacked, because there have been a lot of malicious attacks, and in a business that we are in and very sensitive field, particularly malicious attacks can leave us vulnerable. So has there been any attempts of malicious attacks within the country or from outside or anything significant experience? And kind of path to protect oneself from?
Good question, Bharat. Absolutely. I mean, I think there were definitely attempts at attacks on our system in August and September. And we are happy to report that none of them were successful. Our systems were strong enough to thwart any such attack. Having said that, this is an area of continuous progress and improvement. Hackers are getting smarter, and therefore, as companies, we need to get smarter. And therefore, we have additionally, as an extra precaution, also engaged information security, data security experts to come and work with us in this quarter to evaluate and audit all our systems and help us to become even stronger. But we've been happy that at least whatever attempts were made, thankfully, was not successful.
Yes. Just on a lighter note, hackers are not getting smarter. Actually, while they are probably rascals, but they are among the smartest lot of people.
Correct.
We'll be able to take one last question. The last question is from the line of Anubhav Aggarwal from Crédit Suisse.
A couple of clarification, Ameera. One is the service network that we have today, what percentage of revenues roughly comes from them? I'm talking about like once the non-COVID business has normalized or, let's say, maybe in fiscal '20, what percent revenues we are getting from there?
Vijender, do you want to take that?
What kind of question you're asking?
I'm asking...
What's percentage of revenues are coming through our third-party network?
Yes, third party, in fact, the contribution has been back to normal actually what we used to have pre-COVID days. And in Q2, we have seen good traction on third party. As I said primarily since, as I mentioned, that our strategy has been going closer to patients, I think somewhere down the line, this expansion is helping us a lot in terms of where the patient doesn't want to travel far distance, so they'll be coming down and using our third-party centers.
But Vijender, what would it be as a number? Like is it like less than 10%, 20%? Some quantitative metric you can give.
I think I can tell you that it is more than double digit but what we should look at is how third-party centers are growing. I think there has been a significant growth coming from third party, at least in last quarter.
Okay. And just one more question on your lab network utilization. What kind of percentage utilization, total processing capacity you are at? Let's say, for example, tomorrow there is a surge in antibody testing, how are you placed for that?
So I think the first is that if you look at last 4 to 5 years, we've not expanded our lab network, which is still at 124 labs; only marginal increase. And with so much of expansion on third party, I think we've been able to sustain the growth, what growth has come on account of the expansion. And primarily because we had enough sort of capacity at the back end. And still, we are capable of adding any sort of growth. Like Ameera mentioned that in the month of September we had a growth of about 45% and we were able to service through our current capacity.
Specifically on COVID antibody, luckily out of our 125 labs, I think quite a large number have got the capability of doing immunoassay testing, which is a technology required for COVID antibody. And therefore, we don't think that -- we feel like we are quite well set to be able to take advantage of antibody as this clears. And of course, it depends also on what TAT is going to be required. Usually, this is not a critical test where you have to give a result in 2 hours or 3 hours. But we believe we have the infrastructure ready for that.
Sure. That's helpful. Just one last clarification. Your app now has improved dramatically, the digital app. What percentage of tests typically are you booking through the app now?
Currently it's still small because the app, as you know, the improved app, has only been launched recently. We believe there is still a lot of good things to come. And we will now be actually pushing it as we move forward. Currently, the digital acquisition is happening more from a corporate portal thing versus the app. The app is also contributing to it, but it's still an insignificant number. As we move forward, we will be happy to share, by the end of the year, some more detail on the digital side of the business in terms of acquisitions, in terms of the distinction between the portal, the app, et cetera and give you a little bit more visibility and granular.
We'll take that as the last question. I would now like to hand the conference back to the management team for closing comments.
So thank you, everybody, for joining us today. We hope everybody continues to be healthy. As a company, we are happy with our set of numbers. And most importantly, we continue to be excited for the next quarter. We think we are on strong financial fundamentals. Our operating parameters are getting better, thanks to the digitization and automation that we are doing. And we are back into expansion mode as part of our network expansion and home services distribution goals. And as we said, we continue to evaluate good opportunities in M&A. And hopefully we will be able to make one of those happen sooner than later, fingers crossed. And I think I just want to make sure that, so that everybody is fully aligned with us, when we say that we will continue to put our best foot forward as far as COVID testing, whether it's antibody, antigen or PCR testing, or the new technologies that come in and, of course, continue to push the non-COVID business, which is completely in our influence to be able to do that. Thank you again, and Happy Diwali and New Year to all of you.