Dr Reddy’s Q2 profit rises 69% to Rs 690 cr
Oct 31 2013 , Hyderabad
Posts 17% revenue growth at Rs 3,357 crore
Last year in this period it posted revenues of Rs 2,880.90 crore. The net profit for the second quarter increased by 76 per cent to Rs 690.3 crore, in comparison with Rs 392.5 crore reported for the same period in last financial year. The global generics division has notched a YoY growth of 32 per cent, driven by North America and emerging markets. The company had 19 product launches globally in this quarter, of which four high margin ones were in the US market.
“Revenues from North America went up by 43 per cent largely driven by launch of limited competition products like azacitidin, decitabine, donepazil and divalproex ER tablets. Infact for decitibine and donepazil we were the sole generic players and this factor also contributed much to the growth,” said Saumen Chakraborty, CFO of the company.
The US contributes a chunk of Dr. Reddy’s business totalling between 45 and 50 per cent of sales. While European sales hover around just one per cent, emerging markets - like Russia, CIS countries and rest of the world also witnessed an upsurge in volume in existing products.
“The industry is poised for a good growth in the second half of the financial year. The seasonal impact for us in the emerging markets has been good and grooved well in the second quarter. Although the projections will be muted vis-a-vis last year, we are quite satisfied with our overall performance,” said Abhijit Mukherjee, generics head of Dr. Reddy’s.
The company year hopes to have 15 product launches across markets every year. On the other hand, the pharmaceutical services and active ingredients segment witnessed a decline of 19 per cent to Rs 620 crore compared with the previous year.
The degrowth is because of lower number of ‘launch molecules’ to customers, coupled with deferment of sales in the API space, it said. The numbers may look better in the second half, Dr Reddy’s hopes.
“Dr Reddy’s posted better than expected results, during the quarter on operating front and net profit. The company, posted an OPM of 28 per cent, as against expected 20.8 and 25.9 per cent in the corresponding period of the previous year,’ said Sarabjit Kour Nangra, VP (research - pharma) of Angel Broking.