Dr Reddy's Lab Q1 PAT climbs 108% to Rs 1,188 cr

The drug major's consolidated net profit surged 108% to Rs 1,187.6 crore on 6% rise in net sales to Rs 5,215.40 crore in Q1 FY23 over Q1 FY22.

Consolidated profit before tax stood at Rs 1,465.5 crore in the first quarter, up 97% from Rs 742.5 crore posted in Q1 FY22.

EBITDA soared 74.61% to Rs 1,778.9 crore in Q1 FY23 as against Rs 1,018.8 crore recorded in the corresponding quarter previous year. The EBITDA margin stood at 34.1% in Q1 FY23 higher than 23.9% in Q1 FY22 and 20.7% in Q4 FY22.

Selling, general & administrative (SG&A) expenses stood at Rs 1,549.3 crore, increased by 3% on a year on year (YoY) basis and declined by 1 % sequentially. YoY increase was primarily attributable to investments being done towards marketing of some of company's key brands, investments in digitalization and annual increments, which was partially offset with lower legal and professional expenses. On sequential basis, the expenses have been largely flat, the company stated.

Research & development (R&D) expenses at Rs 432.5 crore. As % to revenues - Q1 FY23 was at 8.3% from 8.0% in Q4 FY22 and 9.2% in Q1 FY22. The company said that it focus continues on building a global pipeline of products across its markets.

The company's other operating income stood at Rs 602.4 crore in Q1 FY23 as compared to Rs 48.7 crore in Q1 FY22. Net Finance income was at Rs 234.9 crore in first quarter from Rs 65.2 crore in Q1 FY22.

During the quarter, revenues from Emerging Markets segment stood at Rs 902.8 crore. Year on year decline of 1 % and sequential decline of 25%.

Revenues from India market stood at Rs 1,333.9 crore. Year on year growth of 26% and Sequential growth of 38%.

Revenues from North America market was at Rs 1,781.5 crore. Year on year growth of 2% and sequential decline of 11%.

Revenues from Europe market was at Rs 414.1 crore. Year on year growth of 4% and sequential decline of 7%.

Revenues from Global Generics (GG) stood at Rs 4432.4 crore. Year on year growth of 8% and sequential decline of 4%. Year on year growth was driven by new product launches across most of company's businesses and divestment of a few non-core brands in India, partly offset by price erosion in firm's generic markets, and higher base due to covid product sales in previous year.

Revenues from Pharmaceutical Services and Active Ingredients (PSAI) was at Rs 709 crore. Year on year and sequential decline of 6% each.

Commenting on the results, co-chairman & MD, G V Prasad said "Our underlying business revenues adjusted for covid products contribution during last year have grown well. The profits were aided by a few non-recurring incomes, offsetting the near term headwinds. We continue to improve the health of our core businesses through productivity improvement and robust product pipelines"

Dr Reddy's Laboratories is engaged in providing medicines. The firm operates in three segments: global generics, pharmaceutical services and active ingredients (PSAI) and proprietary products.

Shares of Dr Reddy's Laboratories were down 3.65% to Rs 4103.60 on the BSE.

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