Dr Reddy’s Laboratories, a leading pharmaceutical company based in Hyderabad, announced a net profit of Rs 1,378.9 crore for the December quarter of FY24. This marks a significant 10.6 percent increase compared to the same period in the previous year. The company achieved its highest-ever sales in a quarter, as highlighted by the management.
Dr Reddy’s Laboratories conducted among nine brokerages estimated the net profit to be Rs 1,383 crore. In the same quarter of the preceding year, the pharma firm reported a profit of Rs 1,237.90 crore. The revenue for the quarter stood at Rs 7,214.8 crore, reflecting a 6.6 percent growth from the year-ago quarter. Notably, this exceeded the brokerage polls’ revenue estimate of Rs 7,030.9 crore. Dr Reddy’s attributed this year-on-year growth to market share gains for existing products in North America and sustained growth in Europe.
The company’s EBITDA rose by 7.4 percent to Rs 2,210.7 crore, with the EBITDA margin expanding slightly to 29.3 percent, compared to 29 percent in the corresponding period last year. Co-Chairman & MD, G V Prasad, expressed satisfaction with the results, stating, “We delivered another quarter of the highest-ever sales and robust financial performance, aided by new products’ performance and base business market share gain in the U.S., new product launch momentum, and strong performance in Europe.”
Contrary to expectations of a marginal rise in revenue, driven by weak domestic market sales and price erosion in key U.S. products, Dr Reddy’s North America business, including the U.S., recorded a significant 9 percent growth in sales at Rs 3,350 crore. This growth was attributed to market share expansion in certain existing key products and revenues from new product launches.
India sales reached Rs 1,180 crore, with a year-on-year growth of 5 percent and a quarter-on-quarter decline of 1 percent. The company explained that the year-on-year growth was due to revenues from new product launches, while the quarter-on-quarter decline was mainly due to lower volumes in the base business.
Revenue from Russia was at Rs. 590 crore, reflecting a year-on-year decline of 14 percent and a quarter-on-quarter growth of 2 percent. The year-on-year decline was primarily attributed to unfavorable currency exchange rate movements and high base business.
During Q3, Selling, General & Administrative (SG&A) expenses amounted to Rs 2,020 crore, marking a 12 percent year-on-year increase. This increase was attributed to investments in sales and marketing, digitalization, and other business initiatives.
Research & Development (R&D) expenses were at Rs 560 crore, accounting for 7.7 percent of the total revenue. Notably, during the quarter, Dr. Reddy’s filed 38 Drug Master Files (DMFs) globally, launched three new brands in India, introduced four new products in the North American region, and filed two new Abbreviated New Drug Applications (ANDAs) with the US Food and Drug Administration (USFDA).