QMS Medical Allied Services Limited — Q2 FY26 earnings call

Call held 17 Nov 2025

Management summary

QMS Medical Allied Services reported robust revenue growth for Q2 and H1 FY26, driven by strong performance in both product and service verticals. While EBITDA margins saw a slight decline due to strategic investments and pricing adjustments, management expects normalization within a year. The company is focused on expanding its patient support programs, leveraging technology, and integrating Saarathi Healthcare to capitalize on India's evolving healthcare landscape.

Highlights

  • Strong revenue growth in Q2 FY26 (20% YoY) and H1 FY26 (35% YoY) driven by operational execution across B2B pharma partnerships and point-of-care offerings.

  • Successful integration of Saarathi Healthcare, strengthening the service vertical and expanding reach in the patient service ecosystem.

  • Product business showing positive trajectory with stable demand and expanding footprint through various platforms (QMS Medical, e-Grameen portal, digital marketplace).

  • Conducted over 16,200 B2B healthcare camps in H1 FY2026, demonstrating strong field operations and administrative processes.

Concerns

  • EBITDA margins declined YoY in Q2 FY26 due to pricing rationalization (larger discounts for volume) and significant investments in infrastructure and personnel.

  • The 26% stake increase in Saarathi Healthcare will only reflect in financial numbers from the next quarter, not Q2 FY26.

Key financials

2 periods

Q2

  • Net Revenue from Operations
    ₹44.7 Cr
    YoY +20%
  • EBITDA
    ₹6.9 Cr
  • EBITDA Margin
    15.5%
  • PAT
    ₹3.6 Cr
  • PAT Margin
    8%

H1

  • Net Revenue from Operations
    ₹91.2 Cr
    YoY +35%
  • EBITDA
    ₹13.4 Cr
  • EBITDA Margin
    14.7%
  • PAT
    ₹6.7 Cr
  • PAT Margin
    7.4%

What they filed

Q1 FY27: revenue up 22.3%, net profit up 25.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue37 44 45 47 45 +20%37 −15%44 −0%57 +22%
EBITDA7 7 6 7 7 −4%7 −3%6 −7%8 +27%
Net profit4 3 4 3 4 −15%3 −9%2 −48%4 +25%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentEBITDA MarginEBITDA Margin (Upper Range)
Service Segment20%25%
Product Segment10%12%

Capital allocation

medium confidence
  • Capex Capex disclosed
    Second, we have invested a lot of things in our infrastructure right now and on the people and all if you see that, so these are the basic reasons for that.
  • M&A Saarathi Healthcare Acquisition · Closed

    Strengthened service vertical by enhancing capabilities and expanding reach within India's evolving patient service ecosystem.

    Increased stake from 51% to 76%; financial numbers from the 26% increase will be included from the next quarter (Q3 FY26).

    The successful integration of Saarathi Healthcare in which we hold a 76% stake has further strengthened this vertical by enhancing our capabilities and expanding our reach within India's evolving patient service ecosystem. ... The acquisition just got over right now, 26% numbers will come from the next quarter actually.

Guidance & targets

Margin

  • Overall Margin Normalization Margin · next year onwards · Medium confidence Stability / Improvement
    going by next year onwards we should see stability in that actually of this. ... Margins definitely from current what stage we are we will be definitely improving our margins that goes without saying that is for sure. ... the results will start showing from next year onwards, so definitely we can assure you that, yes, there will be a better percentage of increase in the margins.

    — Mahesh Makhija

Revenue

  • Product Business Growth Revenue · future · High confidence 10% to 12%
    From the product side of business, we expect a growth of around 10% to 12%. The industry is growing around 10% to 12%, the pharma industry. We expect that same type of growth...

    — Mahesh Makhija

  • Patient Service Programs Growth Revenue · future · High confidence around 25%
    ...our significant growth will obviously come from our patient service programs, which we anticipate that we grow at least a double-digit number, actually, more than the product and service, around 25% approximately so that is the number, the percentile which we are looking at actually.

    — Mahesh Makhija

  • Service Side Revenue Revenue · FY26 · Medium confidence around ₹50 Crores
    This year probably would be around approximately around Rs.50 Crores would be approximately on the service side of what we end this year...

    — Mahesh Makhija

Camps

  • Total Camps Camps · FY26 · High confidence around 33,000
    We expect at least to retain the same number 16,400 numbers at least, so we expect to close at around that same number 33,000 camps approximately.

    — Mahesh Makhija

What to watch in Q3 FY26

Saarathi Acquisition Financial Impact

next quarter
Current 26% stake increase completed, not yet reflected in Q2 financials
Target Financial numbers from the 26% stake increase to be included in Q3 FY26 results

Why it matters

To assess the full financial contribution and integration benefits of the increased stake in Saarathi Healthcare.

The acquisition just got over right now, 26% numbers will come from the next quarter actually.

Risks & concerns

  • EBITDA margin compression

    medium

    EBITDA margins declined due to pricing rationalization (larger discounts for volume) and significant investments in infrastructure and personnel, with normalization expected in about a year.

    Both acknowledged

  • SEBI inquiry/news regarding IPO fund misallocation

    low

    An article in SEBI news about IPO fund misallocation was raised, but management stated they had addressed all queries and there was no material impact.

    Analyst downplayed

Q&A highlights

7 direct, 1 evasive
Inclusion of Saarathi acquisition financials in Q2 FY26 revenue Direct
The acquisition just got over right now, 26% numbers will come from the next quarter actually.

Clarifies that the full financial impact of the increased stake in Saarathi will be visible from Q3 FY26, not Q2.

Asked by Sameera Middha

EBITDA margins for product and service segments Direct
Service segment the EBITDA margins are around 20% to 22% and our product is around 10% to 12%.

Provides crucial segment-wise profitability metrics, indicating higher margins in the service business.

Asked by Sameera Middha

Explanation of patient support program industry, market size, and target customers Direct
First of all, it is a basic fundamental contextual patient support program, is patient adherence to the therapy which is written by the doctors... the entire objective of running patient program is to help patient to adhere to the treatment that the doctor has prescribed...

Offers a detailed overview of the company's core service business, its value proposition, and market dynamics, including the shift from doctor-centric to patient-centric spending.

Asked by Nish Shah

SEBI article on IPO fund misallocation Evasive
We read that article, but from our point of view two years back also we have updated all our details from the NSE board... we have nothing to hide from anything in this story.

Addresses a potential regulatory concern or negative news, with management asserting transparency and no material impact.

Asked by Nish Shah

Reasons for YoY decline in EBITDA margins Direct
There are two things: obviously, the pricing, a lot of camps, pricing and all that have been rectified right now based on the volume, so, larger discounts have been given on that so that the volume increases. Second, we have invested a lot of things in our infrastructure right now and on the people and all if you see that, so these are the basic reasons for that.

Explains the factors contributing to margin compression, attributing it to strategic volume-driven pricing and infrastructure investments.

Asked by Nish Shah

Timeline for margin normalization Direct
In another year's time.

Provides a clear, albeit approximate, timeline for investors to expect a recovery in the company's profitability margins.

Asked by Nish Shah

Quarterly revenue dip from Q1 to Q2 Direct
If you see our financials for the last couple of years, if you go quarter wise normally Q1 is on the higher side, Q2, Q3 tend to drop a little bit and then we pick up in our highest quarter Q4 this is a trend that has been repeating itself over the last five years.

Clarifies the seasonal nature of the company's revenue, explaining the typical Q1 strength and Q2/Q3 dip, which is a recurring trend.

Asked by Rohan Gandhi

Key short-term and long-term strategic priorities Direct
First of all, our key priorities for the next one or two years is, first, the integration of QMS and Saarathi... Second will be to expand our market base in the patient support programs... and third we will be continuing to grow our B2B business in different geographies...

Outlines the company's strategic roadmap for the next 2-3 years and beyond, focusing on integration, market expansion, and B2B growth, including international aspirations.

Asked by Shatak Gandhi

3 min read 6 chapters

Detailed narrative

Q2 & H1 FY26 Financial Performance

QMS Medical Allied Services reported a strong financial performance for Q2 FY26, with net revenue from operations reaching ₹44.7 Crores, marking a 20% year-on-year growth. EBITDA for the quarter stood at ₹6.9 Crores, translating to a 15.5% margin, while PAT was ₹3.6 Crores with an 8% margin. For the first half of FY26, net revenue was ₹91.2 Crores, a 35% year-on-year increase, with EBITDA at ₹13.4 Crores (14.7% margin) and PAT at ₹6.7 Crores (7.4% margin). These results underscore the resilience of the company's operational model across both its service and product verticals.

Strategic Growth Drivers: Product and Service Businesses

The product business maintained its positive momentum, driven by consistent demand in healthcare and wellness categories, including the flagship Q-Devices brand. Its footprint is expanding through strong distribution partnerships and presence across e-commerce platforms and government portals. The service business, a key strategic driver, benefited from deeper engagement with leading pharma clients and increased adoption of structured patient support programs across various therapy areas. The successful integration of Saarathi Healthcare, where QMS holds a 76% stake, has significantly enhanced capabilities and expanded reach within India's patient service ecosystem.

Operational Footprint and Healthcare Camps

In H1 FY2026, QMS conducted over 16,200 B2B healthcare camps, demonstrating robust field operations and upgraded back-end processes. The company currently operates with 120 field officers covering 5,000 postal codes, equipped with diabetic equipment and HbA1c strip machines. These officers conduct approximately 2,500 to 3,000 camps per month, with an expectation to close FY26 with around 33,000 camps. The company also leverages a network of about 900 freelance dietitians to support its services.

Margin Dynamics and Future Outlook

EBITDA margins experienced a decline in Q2 FY26, attributed to pricing rationalization, including larger discounts offered to increase volume, and significant investments in infrastructure and personnel. Management expects margins to stabilize and improve from next year onwards as these investments begin to yield results. The company anticipates product business growth of 10-12%, aligning with the broader pharma industry, while patient service programs are projected to grow at approximately 25%.

Long-term Vision and Capabilities

QMS aims to become a one-stop solution for pre-diagnosis, early diagnosis, point-of-care, and marketing activities for pharmaceutical companies, including second and third-tier players. The company also seeks to be a leader in launching brands with multinational companies, aiding market access and geographic penetration. Over the next 5-10 years, QMS plans to explore international expansion, starting with Asia-Pacific markets like Vietnam and Cambodia, leveraging its expertise and data-driven insights. Key capabilities being built include talent acquisition and retention, infrastructure development, and innovation in health tech, particularly integrating AI into analytics and CRM.

Saarathi Healthcare Integration and Financial Impact

QMS has successfully integrated Saarathi Healthcare, increasing its stake to 76%. This acquisition is a strategic move to strengthen the company's service vertical and expand its presence in the patient service ecosystem. While the acquisition was completed recently, the financial impact of the additional 26% stake will only be reflected in the company's financial results from the next quarter (Q3 FY26). This integration is expected to enhance capabilities and broaden the company's reach within India's evolving healthcare landscape.

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