Dr Reddy’s Laboratories Q3 Results: Net profit rises 10.6% to ₹1,379 crore; 5 key highlights

Dr Reddy's Laboratories Q3 Results: Dr Reddy's Laboratories announced its October-December quarter results for fiscal 2023-24 (Q3FY24), reporting a rise of 10.6 per cent in net profit at ₹1,379 crore, compared to ₹1,247 crore in the year-ago period. The rise in profit was driven by higher market share in existing products in North America and growth in Europe.

"We delivered another quarter of highest ever sales and robust financial performance aided by new products performance and base business market share gain in the US, new products launch momentum and strong performance in Europe," said GV Prasad, Co-Chairman and MD, Dr Reddy's Laboratories.

Also Read: Dr Reddy's Q3 net profit rises 11% to ₹1,378.9 crore

The drug maker continues to strengthen its core businesses and invest in innovative products in strategic collaborations for novel molecules to meet unmet needs of patients, he added. On Tuesday, shares of Dr Reddy's Laboratories settled 0.03 per cent higher at ₹5,845.75 apiece on the BSE.

Here are 5 key highlights of Dr Reddy's Laboratories Q3 scorecard:

1.Revenue from operations

The Hyderabad-based drug major's revenue from operations in the third quarter of current rose 6.6 per cent to ₹7,215 crore, compared to ₹6,770 crore in the corresponding period last year. Revenues in the domestic market saw a rise of 5 per cent year-on-year to ₹1,180 crore in the October-December period of this fiscal. 

2.Global generics

Dr Reddy's said its revenues in North America grew 9 per cent year-on-year to ₹3,349 crore in the third quarter. In Europe, the revenue grew 15 per cent year-on-year to ₹500 crore in the period under review. Lenalidomide, a generic version of Bristol Myers Squibb's cancer drug Revlimid, boosted the company's generics business in the U.S. Dr Reddy's launched the generic version in 2022. 

However, the company said that revenue growth in the generics business was partially offset by "price erosion" in certain markets. During the quarter, Dr. Reddy’s launched four new products in the North American region. It also filed two new Abbreviated New Drug Applications (ANDAs) with the US Food and Drug Administration (USFDA) in the period. During the quarter, Dr. Reddy’s filed 38 Drug Master Files (DMFs) globally.

3.Operating performance

Dr Reddy's earnings before interest, tax, depreciation and amortization (EBITDA) in the December quarter rose 7.4 per cent to ₹2,110.7 crore, compared to ₹1,965.8 crore. EBIT margin in the quarter-under-review stood at 29.3 per cent, compared to 29 per cent in the year-ago period.

4.Deals

The pharma major acquired the MenoLabs branded portfolio of women's health focused supplements in the US. It had ‘exclusive collaboration’ with Coya Therapeutics for development and commercialization of COVA 302, an Investigational Combination Therapy for treatment of Amyotrophic Lateral Sclerosis (ALS), said Dr Reddy's in its exchange filing. The company's board also approved fund infusion of up to ₹650 crore by way of investment in equity shares of Aurigene Oncology, a wholly-owned subsidiary of the company.

5.Expenses, R&D

Selling, general & administrative (SG&A) expenses for the December quarter rose 12 per cent to ₹2,020 crore. The rise in (SG&A) spend was due to investment in sales and marketing, digitalization, and other business initiatives. Research & development (R&D) expenses were at ₹560 crore, accounting for 7.7 per cent of total revenue. During the quarter, the company launched new brands in India.