- Dr. Reddy’s net income for 1Q 2025 reached 14.2 billion rupees, marking a 2% increase year over year but missing the estimated 15.13 billion rupees.
- Total revenue increased by 11% year over year to 85.5 billion rupees, slightly below the estimated 86.95 billion rupees.
- Generics revenue rose by 9.7% to 75.6 billion rupees, surpassing the estimate of 74.74 billion rupees.
- North America revenue saw a significant decline of 11% to 34.1 billion rupees, missing the estimate of 37.53 billion rupees.
- India sales grew by 11% to 14.7 billion rupees, exceeding the estimate of 14.45 billion rupees.
- Europe sales reached 12.7 billion rupees, a notable increase from 5.27 billion rupees year over year, beating the estimate of 10.69 billion rupees.
- Emerging Markets revenue increased by 18% to 14 billion rupees, compared to the estimate of 13.21 billion rupees.
- Russia revenue rose by an impressive 29% year over year to 7.1 billion rupees, exceeding the estimate of 6.25 billion rupees.
- Total costs grew by 16% year over year to 69.6 billion rupees.
- Other income jumped by 55% to 2.9 billion rupees.
- R&D expenses were 6.24 billion rupees, slightly higher than last year, but below the estimate of 6.94 billion rupees.
- Ebitda increased by 5.6% to 22.8 billion rupees, short of the estimate of 23.29 billion rupees.
- Gross margin decreased from 60.4% year over year to 56.9%.
- Co-Chairman & MD, GV Prasad, mentioned expectations of intensified pricing pressure on Lenalidomide in the US generics market.
- Prasad also highlighted the company’s strong overall performance, emphasizing growth in branded markets and the Nicotine Replacement Therapy portfolio.
- The company addressed all observations from a US FDA inspection at their API facility in Telangana within the given timelines.
Dr. Reddy’s Laboratories on Smartkarma
Top independent analyst, Tina Banerjee, recently covered Dr. Reddy’s Laboratories on Smartkarma, a renowned investment research network. In her insightful analysis titled “Dr. Reddy’s Laboratories (DRRD IN): Q3FY25 Result- Subdued US Business Dents Margin; Somber Outlook”, Banerjee highlighted the challenges faced by the company. Dr. Reddy’s Laboratories reported stagnant US revenue in Q3FY25, primarily due to lower contribution from Lenalidomide, leading to a bearish sentiment.
The lack of significant growth catalysts and limited revenue visibility in the US market contribute to the bearish outlook. With no key launches lined up to offset the impact of Lenalidomide, the company’s valuation appears cheaper but justified. Banerjee’s analysis suggests that Dr. Reddy’s Laboratories may not present a value buying opportunity at present, as the bleak growth outlook continues to weigh on the company’s prospects.
A look at Dr. Reddy’s Laboratories Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 5 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 4.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Dr. Reddy’s Laboratories Limited, a prominent pharmaceutical services provider, has been rated using the Smartkarma Smart Scores system to assess its long-term outlook. With a solid score of 5 in Resilience, the company demonstrates strength in weathering challenges and maintaining stability. Additionally, scoring 4 in both Dividend and Growth, Dr. Reddy’s Laboratories shows promise in rewarding investors through dividends and displaying potential for future expansion. The company also received a score of 4 in Momentum, indicating positive market momentum. Although Value scored a 3, the overall outlook remains positive for Dr. Reddy’s Laboratories.
In conclusion, Dr. Reddy’s Laboratories Limited, known for manufacturing bulk drugs and formulations such as verapamil and cephalexin, excels in various aspects as reflected in its Smartkarma Smart Scores. With a strong emphasis on resilience, dividends, growth potential, and market momentum, the company appears well-positioned for long-term success in both the domestic Indian market and on a global scale, underlining its status as a leading player in the pharmaceutical industry.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
Have feedback on this article? Concerned about the content? Get in touch with us directly.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Analytics and News
- ✓ Events & Webinars
