Jefferies has initiated coverage on the recently listed Molbio Diagnostics with a ‘Buy’ rating and a target price of Rs 1,600, indicating an upside of 27% from current levels. The brokerage cited the company’s Truenat molecular diagnostics platform, a growing product pipeline and the expected scale-up of its newer businesses in portable radiology and digital pathology.
The brokerage expects Molbio to enter a period of faster earnings growth as Truenat expands in India and overseas, Prognosys gains scale and OptraScan begins its commercial rollout in the US. Jefferies forecasts revenue to grow at a 22% CAGR between FY26 and FY29E, while EBITDA and profit after tax are expected to grow at 36% and 47%, respectively.
The Jefferies analysts wrote that Molbio has already demonstrated its ability to commercialise an indigenous molecular diagnostics platform and is now building a broader med-tech portfolio around it.
“Molbio is among the select group of innovation-led healthcare companies from India and has already validated its capabilities through the successful commercialisation of the Truenat platform, while Prognosys and Optrascan continue to scale their market presence,” the analysts wrote.
Truenat remains the main growth engine
Truenat accounted for 86% of Molbio’s FY26 revenue and remains the largest contributor to the company’s business. Jefferies expects the platform to grow at a 15% CAGR through FY29E, with test-kit revenue growing at 17% annually.
The brokerage expects test kits to account for about 90% of Truenat revenue by FY29, compared with 86% in FY26. That would increase the contribution from recurring consumables while device revenue remains relatively stable because of the longer replacement cycle of the equipment.
Jefferies also points to the positioning of Truenat against larger molecular diagnostics platforms. The report says Truenat is battery-operated, portable and designed for decentralised testing, with a result turnaround time of about 60 minutes.
According to the comparison on page 5 of the report, Truenat has an installed base of more than 12,500 systems, while GeneXpert has more than 60,000. Truenat also weighs substantially less and requires less infrastructure, making it suitable for primary health centres and remote healthcare facilities.
TB testing and global expansion offer room for Truenat
Jefferies expects Truenat’s growth to come from deeper penetration of TB testing in India and overseas markets, along with the potential expansion of testing into other diseases.
The report says Truenat was patented in more than 100 countries as of FY26 and supported molecular testing for 30 diseases through 43 assays. Its menu includes TB, COVID-19, hepatitis B and C, HIV and HPV.
The brokerage also points to the size of the addressable point-of-care market. It estimates the global POCT market at USD 29.3 billion in CY25, with the market expected to reach USD 67.1 billion by CY30E, implying a 17.9% CAGR.
Within infectious disease POCT, TB is the largest segment. Jefferies estimates the global TB point-of-care testing market at USD 4.3 billion in CY25.
Prognosys and OptraScan could change the revenue mix
Molbio’s growth story is no longer limited to molecular diagnostics. The company owns a 70% stake in Prognosys, which provides portable X-ray solutions, while OptraScan gives it exposure to digital pathology.
Jefferies expects Prognosys revenue to grow at a 31% CAGR through FY29E. The brokerage sees opportunities in TB screening as well as veterinary diagnostics, mobile ambulances, home healthcare and security screening.
OptraScan is expected to become a more meaningful contributor after its US commercial rollout. Jefferies expects the business to process nearly 1.5 million slides annually by FY29 and generate around Rs 300 crore of revenue, including device sales. It also expects the currently loss-making platform to become EBITDA accretive by FY29, with margins above 30%.
As a result, Truenat’s share of Molbio revenue is expected to decline from 86% in FY26 to 73% by FY29E, while OptraScan’s contribution could reach 11%. Prognosys is expected to contribute 13%.
Jefferies sees margin expansion as capacity utilisation improves
The brokerage expects Molbio’s EBITDA margin to rise from 22% in FY26 to about 31% by FY29E, an expansion of roughly 830 basis points.
One driver is higher utilisation of Truenat test-kit capacity. Jefferies estimates utilisation could rise from 58% in FY26 to 77% by FY29E.
The brokerage also expects OptraScan’s scale-up to improve group profitability, while employee costs are estimated to decline from 10% of revenue to 8% and other operating expenses from around 22% to about 18% over the forecast period.
This is expected to translate into EBITDA rising from Rs 321 crore in FY26 to Rs 807 crore by FY29E. Profit after tax is forecast to rise from Rs 167 crore to Rs 527 crore over the same period.
New products widen Molbio’s pipeline
Beyond Truenat, Prognosys and OptraScan, Molbio is working on several products and partnerships across diagnostics.
The Jefferies report lists multiplex RT-PCR panels for sepsis, fever and bacterial or viral meningitis, a rapid TB triage test, saliva-based alcohol detection, blood-based biomarker testing for TB and near-patient breast cancer screening.
Molbio is also working with Equine Biotech on veterinary molecular diagnostic assays compatible with the Truenat platform. The company launched its EDGE programme in 2024 to work with med-tech startups and SMEs on product development and commercialisation.
Jefferies said the company is also developing a dedicated Centre of Excellence in Bengaluru, targeted for completion by FY28/29, to help take early-stage diagnostic and med-tech products towards commercial manufacturing.
Jefferies values Molbio at 40 times September 2028 earnings
Jefferies said Molbio does not have a directly comparable listed Indian peer because of its differentiated business model. It therefore benchmarks the company against Poly Medicure and listed diagnostics companies.
The brokerage values Molbio at 40 times September 2028 estimated EPS and arrives at a target price of Rs 1,600. It said the multiple is broadly in line with Poly Medicure and at a discount to the diagnostics companies used in its comparison.
At the target price, Jefferies sees 27% upside.
The brokerage’s estimates point to EPS rising from Rs 14.5 in FY26 to Rs 45.7 by FY29E, while RoCE is expected to improve from 18% to 27%. RoIC is projected to rise from 27% to 40% over the same period.
| Metric | FY26 | FY27E | FY28E | FY29E |
| Revenue | Rs 1,446 crore | Rs 1,779 crore | Rs 2,190 crore | Rs 2,646 crore |
| EBITDA | Rs 321 crore | Rs 444 crore | Rs 620 crore | Rs 807 crore |
| Net profit | Rs 167 crore | Rs 244 crore | Rs 388 crore | Rs 527 crore |
| EPS | Rs 14.5 | Rs 21.2 | Rs 33.7 | Rs 45.7 |
| EBITDA margin | 22% | 25% | 28% | 31% |
| RoCE | 18% | 20% | 25% | 27% |
Government exposure and TB concentration remain key risks
Jefferies has identified two major risks to its thesis. Around 80% of Molbio’s FY26 revenue came from the business-to-government segment, while roughly 70% was derived from TB testing.
That concentration leaves the company’s growth sensitive to government procurement and the pace of expansion in TB testing.
The report also identifies product quality and safety as a material issue for the company because Molbio manufactures medical diagnostic devices.
For now, Jefferies’ case rests on Molbio moving from a Truenat-led diagnostics business towards a broader med-tech portfolio, with recurring test-kit revenue, new product launches and higher utilisation providing the main earnings drivers over the next three years.
Disclaimer: This article is based solely on the Jefferies research report on Molbio Diagnostics dated September 29, 2026. The target price, estimates, growth forecasts, valuation methodology, business outlook and other analytical views attributed to Jefferies and its analysts are their own and have not been independently verified by the publication. The revenue, EBITDA, profit, EPS, margin and return-ratio figures are based on Jefferies estimates and may differ from actual results. The target price and implied upside are based on the figures stated in the report and do not represent live market prices. Actual operating and financial outcomes may vary due to government procurement, TB testing demand, product launches, regulatory approvals, international expansion, competition, execution, pricing, product quality and other business or market-related factors. This article is intended for informational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security.