Dr Reddy's Laboratories Ltd reported a weak set of first-quarter earnings, with consolidated net profit plunging nearly 69% year-on-year and missing analyst estimates amid a sharp contraction in operating margins.
Dr Reddy's reported a consolidated net profit of Rs 444 crore for the June quarter, down 68.7% from Rs 1,418 crore a year earlier. The figure was well below the Bloomberg consensus estimate of Rs 737 crore.
Revenue from operations declined 5.5% year-on-year to Rs 8,100 crore from Rs 8,572 crore, missing the Bloomberg estimate of Rs 8,221 crore.
Dr Reddy's Labs Q1 Result Highlights (Cons, YoY)
- Net Profit falls 68.7% at Rs 444 crore versus Rs 1,418 crore (Estimate of Rs 737 crore).
- Revenue down 5.5% at Rs 8,100 crore versus Rs 8,572 crore (Estimate of Rs 8,221 crore).
- Ebitda down 60.4% at Rs 861 crore versus Rs 2,173 crore (Estimate of Rs 1,398 crore).
- Ebitda Margin at 10.6% versus 25.3% (Estimate of 17%).
Ebitda fell 60.4% to Rs 861 crore from Rs 2,173 crore in the corresponding quarter last year, compared with analysts' estimate of Rs 1,398 crore.
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The Ebitda margin contracted sharply to 10.6% from 25.3% a year ago, significantly below the Bloomberg estimate of 17%.
Other income rose to Rs 355 crore during the quarter from Rs 290 crore in the year-ago period.
Business Performance
Revenue from the Global Generics business declined 4.8% year-on-year to Rs 7,208 crore.
The pharmaceutical services and active ingredients (PSAI) business delivered better performance, with revenue rising 8.7% year-on-year to Rs 1,073 crore.
Among key geographical markets, North America revenue fell 35% year-on-year to Rs 2,205 crore, weighing on the company's overall performance.
In contrast, other regions posted healthy growth. Emerging Markets revenue increased 31% to Rs 1,833 crore, while India business revenue rose 17% to Rs 1,718 crore. Europe revenue also grew 13% year-on-year to Rs 1,444 crore.
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