Dr Reddy's Laboratories Q2 PAT slips 35.6% YoY
Net profit attributable to equity shareholders of the parent company fell 35.6% year on year to Rs 925 crore from Rs 1,437.2 crore in Q2 FY26. Sequentially, net profit rose 108.6% from Rs 443.5 crore in Q1 FY27.
Gross profit declined 6.1% year on year to Rs 4,520.4 crore from Rs 4,814 crore. Gross margin narrowed to 52.1% from 54.7% a year earlier, but improved from 46.5% in Q1 FY27.
Profit before tax declined 33.1% year on year to Rs 1,227.7 crore from Rs 1,835 crore in Q2 FY26. It rose 122.2% quarter on quarter from Rs 552.6 crore in Q1 FY27.
The company reported EBITDA of Rs 1,783 crore, with a margin of 20.6%, and a net cash surplus of Rs 2,502 crore. EBITDA declined 24% year on year and increased 77% quarter on quarter. Q1 FY27 was impacted by a Rs 240 crore provision for inventory and other costs related to the semaglutide API issue.
Selling, general and administrative expenses increased 6.2% year on year to Rs 2,807.5 crore, while research and development expenses declined 15.6% to Rs 523.5 crore.
The global generics business recorded revenue of Rs 7,792.7 crore, down 0.7% year on year but up 8.2% quarter on quarter. North America revenue fell 23.2% year on year to Rs 2,489 crore. Emerging markets revenue rose 24.4% to Rs 2,059.5 crore, while India revenue increased 17.3% to Rs 1,850.8 crore. Europe revenue grew 1.3% to Rs 1,393.5 crore. Revenue from pharmaceutical services and active ingredients declined 12.1% to Rs 831 crore.
The company said lower lenalidomide sales in North America primarily affected quarterly revenue. Excluding lenalidomide sales in North America, its underlying base business continued to deliver double-digit growth across businesses, except Europe and active pharmaceutical ingredients, supported by favourable currency movements.
?We continued to improve the overall health of our business, delivering double-digit base business growth and EBITDA margins of over 20% during the quarter,? said G V Prasad, co-chairman and managing director. He added that the company remained focused on strengthening its core businesses, enhancing productivity and investing in strategic growth platforms.
Dr. Reddy's Laboratories is a Hyderabad-based global pharmaceutical company offering APIs, generics, branded generics, biosimilars and OTC products. Its key therapeutic areas include gastrointestinal, cardiovascular, diabetology, oncology, pain management and dermatology. Major markets include the US, India, Russia and CIS countries, China, Brazil and Europe.
Dr Reddy's Laboratories shares jumped 5.88% to Rs 1,296.50 on the BSE.
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