Dr. Reddy's Q4 Results: Profit Rises, Misses Estimates

Dr. Reddy’s Laboratories Ltd. saw its net profit rise 9.9 times during the fourth quarter of fiscal 2023, missing analyst estimates.

Other Highlights (YoY)

• Revenue from the mainstay North American market rose 27%, contributing 40% of the total sales. This was driven by new product launches and favourable forex movement, which was partly offset by price erosion.

• Six new products were launched in the U.S. in the fourth quarter.

• European business rose 12%, accounting for 8% of the revenue.

• India revenue was up 32%, contributing 20% of the total revenue for the quarter. Growth was driven by favourable price variance, new product launches, and non-core brand divestments, the filing said.

• Emerging market sales declined 7%, making up 18% of the revenue for the quarter. Of this, Russia reported a year-on-year sales decline of 24%, mainly attributable to divestment income and higher channel inventory.

• Pharmaceutical services and active ingredients segment grew 3%. It made up 12% of the total revenue.

• Expenditure on selling, administration and distribution rose 15% to Rs 1,800 crore.

• Research and development expenses stood at 8.5% of revenue. “We continue our focus on investing in R&D to build a healthy pipeline of new products across our markets for both small molecules and biosimilars,” the company said in the filing.

• The company has a net cash surplus of Rs 5,050 crore, as on March 31.

Shares of Dr. Reddy's Laboratories closed 1.27% lower, prior to the announcement of the results, as compared with a 0.29% rise in the benchmark Sensex.