Remedi proves it can make money in India ... AI diagnostics fuel growth

[The Financial News]  Remedi, a specialist in ultra-compact X-ray equipment, is expanding its AI imaging-diagnostics business, building on the large-scale supply record it has established in India’s public healthcare market. After proving the profitability of its portable medical-device sales, the company is looking to diversify its revenue structure by adding AI interpretation services.
On the 16th, Lee Da-bin, an analyst at Eugene Investment & Securities, said of Remedi, “It is time to turn the scalability of its core technology into sustained growth,” highlighting the growth potential of its new businesses. However, the firm did not issue an investment rating or a target price.
Remedi’s revenue in the first half of this year was 15.6 billion won, up 110% from the same period a year earlier. Operating profit surged 489% to 6.2 billion won, and its operating margin reached 40%. Supplies of equipment for tuberculosis screening to the Indian government drove the improvement, allowing the company to surpass its full-year results for last year in the first half.
Last year, Remedi won a tender from India’s National Tuberculosis Elimination Programme (NTEP) and signed a contract to supply a total of 1,534 portable KA6 X-ray units. It delivered about 750 more units in the first half of this year. Leveraging its low-dose, high-resolution and miniaturization technologies, the company is expanding its business beyond medical equipment to include industrial non-destructive testing equipment.
AI imaging diagnostics is the company’s new growth engine. Last August, Remedi teamed up with Daewoong Pharmaceutical and began a proof of concept (PoC) for a business combining compact X-ray and ultrasound equipment with AI interpretation technology, targeting primary-care institutions in South Korea.
Eugene Investment & Securities said AI analysis services differ from conventional equipment sales in that they can generate recurring revenue as the number of healthcare institutions grows. It also noted, however, that additional orders from India, expansion into new countries and successful commercialization of the AI business would be needed to reduce the earnings volatility inherent in public procurement. 
“Over the medium to long term, an increase in corporate value is expected to gather momentum once the company diversifies its revenue sources and proves that its growth is sustainable,” the analyst added.


[email protected] Kim Gyeong-a Reporter