Dr. Reddys Lab’s (DRL) revenue, increased by 13.6% YoY to Rs40.2 bn, is higher than our estimates of Rs 38.9bn; primarily due to good growth in Europe and Emerging market business. EBITDA margins grew to21.2% inline with our estimates of 21.0% on account of lower SGA and R & D expenses.
Dr. Reddy’s Laboratories or DRL’s revenues in 3QFY19 at Rs 38,500mn were in line with our estimate as well as consensus estimate. However, net earnings at Rs4,878mn were 10%/29% above our estimate/consensus estimate, respectively.
DRL’s revenues increased by 7% YoY to Rs 37.9 bn (lower than our estimates of Rs 38.9 bn) primarily due to de-growth in US business on account of higher pricing pressure due to incremental competition in some of the key products.
Dr. Reddy’s Laboratories or DRL reported a strong performance in 1QFY19 as its revenues (Rs37,207mn) grew 5.3% QoQ and 12.2% YoY, which were driven by growth across businesses and geographies. Revenues were above our/consensus estimates by 4.6%/ 6.2%, respectively.
We have presented here a review of the key events that impacted Dr. Reddy’s Laboratories or DRL’s performance in FY18 and its outlook for FY19 based on a close reading of its annual report for 2017-18 and 20F filing.
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