Health X Platform Limited Q1 FY27 Earnings Conference Call Summary

Disclosure Reference: Regulation 30 of SEBI (LODR) Regulations, 2015

Financial Performance Highlights

Revenue and Profitability:

  • Revenue from operations: ₹440 crores in Q1 FY27, representing 58% year-on-year (YoY) growth and 16% quarter-on-quarter (QoQ) growth from ₹378 crores in Q4 FY26
  • Gross profit: ₹34 crores, showing 64% YoY growth and 24% QoQ growth
  • Gross margin: Improved to 7.8% from 7.3% in Q4 FY26
  • EBITDA: Loss of ₹14.9 crores, narrowing from ₹20 crores loss in Q4 FY26
  • EBITDA margin: Improved to -3.4% from -5.5% in Q4 FY26
  • PAT: Profit of ₹2 crores, a significant improvement from loss of ₹13 crores in Q4 FY26, though below ₹26 crores PAT reported in Q1 FY26

Operational Scale:

  • Serves approximately 75,000 retail pharmacies
  • Offers more than 50,000 SKUs
  • Sources from over 1,000 vendors
  • Supported by more than 350 health buddies and 3,500 employees
  • More than 95% of purchases sourced directly from pharmaceutical companies
  • Purchase return rate remains below 1%

Business Segment Performance

RetailerShakti (B2B Platform):

  • Grew 48% YoY
  • 69.4% of business comes from orders above ₹2,500
  • 42.4% of business comes from orders above ₹5,000
  • Gross margin maintained at approximately 7.8%
  • EBITDA closer to break-even, expected to turn positive in Q3 FY27

SastaSundar (B2C Platform):

  • Grew 44% YoY
  • 69.2% of orders above ₹1,000
  • 30.8% of orders below ₹1,000

Geographical Distribution:

  • 67% of RetailerShakti business from tier 2 and tier 3 markets
  • 78% of SastaSundar business from tier 2 and tier 3 markets
  • 30% of current business now comes from outside West Bengal

Strategic Initiatives and Expansion

Geographical Expansion:

  • Expanded beyond West Bengal into Odisha, Bihar, Jharkhand, and Chhattisgarh
  • Strengthened northern operations through Noida infrastructure
  • Northeast region showing highest growth rate
  • Planning new warehouse in Ranchi (Jharkhand)

JITO Private Label Initiative:

  • Aim to make healthcare more affordable with medicines up to 60% lower than branded alternatives
  • Q4 FY26 sales: ₹25 lakhs
  • Q1 FY27 sales: ₹79 lakhs (showing significant growth)
  • Gross margin above 50%
  • 19 Healthbuddies already converted to JITO, 25 more in pipeline
  • Target to convert 50% of Healthbuddies to JITO within 3 months

Technology Investments:

  • Developing AI-monitored RetailAir product for retailers
  • Scheduled to launch in current quarter (Q2 FY27)
  • Focus on automating inventory management and reducing retailer inventory from 30 days to 5-6 days
  • Technology investments representing 40-45% of current spending

Infrastructure Development:

  • Noida warehouse already operational
  • West Bengal warehouse partly completed
  • Guwahati capacity expanded with new rental warehouse (75,000 sq. ft.)
  • Construction started in Udaipur
  • Patna and Lucknow warehouses to start in next 2-3 months
  • Existing infrastructure can support growth up to ₹3,000 crores revenue

Management Outlook and Guidance

Growth Expectations:

  • July 2026 monthly revenue: ₹150+ crores (subject to audit)
  • FY27 expected to be the best year in company history
  • Target gross margin: 8%+ for full year FY27, eventually reaching 12%
  • Long-term gross margin target: 12% (aligned with industry standards)

Investment Strategy:

  • Spending approximately 15% of revenue to build SastaSundar business
  • Marketing and advertising: 25-30% of spending
  • Technology costs: 40-45% of spending
  • Customer acquisition: 30% of spending
  • Focus on capital efficiency rather than EBITDA profitability in short term
  • Working capital cycle: approximately 28 days (8% of revenue)

Market Position:

  • Current market share in Kolkata/West Bengal: 3-4%
  • Target market share: 7% in next 2-3 years
  • Average wallet share with pharmacies: approximately 2%
  • Target to double wallet share per retailer
  • 40,000 pharmacies active in last 30 days

Corporate Developments

SEBI Approval:

  • Merger and demerger scheme with SEBI is on track
  • Company has started responding to stock exchange queries
  • No problems identified so far

Historical Context:

  • Company sold Flipkart business for ₹800 crores in the past
  • Current quarter revenue has exceeded the highest turnover during Flipkart partnership era

Additional Business Metrics

Treasury Income:

  • Represents 7-8% of revenue

Fulfillment Centers:

  • Becoming increasingly automated and technology-led
  • All logistics riders are company employees (not third-party)
  • Focus on maintaining proper atmosphere for pharmaceutical products

Healthbuddy Model:

  • Franchisee partners who don't hold inventory
  • Handle last mile delivery, compliance, and customer engagement
  • Operate as independent franchisee partners