We have added to Integral Diagnostics (IDX) following its trading update at its AGM. While organic revenue remains below expectations in 1Q22, we expect IDX’s revenue to recover materially as lockdown restrictions are eased in Australia and New Zealand, and patients return to normal healthcare testing and elective surgery lists recommence.
Australian imaging has grown at an average of 7% per annum for the last 15 years. A strong sequential improvement in calendar 2022 for IDX should deliver an attractive mix of both volume and price recovery. Furthermore, organic growth should be enhanced with brownfield/greenfield investments and the contribution of EPS accretive M&A.