PE deratings are likely to persist in the diagnostic segment as two factors continue to pressure valuations: (1) sliding margins – from 27% in FY22 to 24% in FY25 (9MFY23 at 24.8%) on weaker pricing power/ increasing online competition and costs, and (2) falling ROE following expensive M&As. After three exciting phases in the past decade, we expect growth to normalize to ~12-13% over FY23-25E (-5% in 9MFY23, 17% in non-Covid sales, 11% ex-M&A) on the back of favorable segmental macros and geographical expansion.