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Below are Views On Dr. Reddy’s Laboratories ltd reported numbers in line with the expectation By Mr. Yash Gupta Equity Research Associate, Angel Broking Ltd   

Dr. Reddy’s Laboratories ltd reported numbers in line with the expectation, stock down by more than 3%. Dr. Reddy’s Laboratories ltd total revenue from operations for Q3FY21 stood at ₹4929 crores up by 12% YoY from ₹4383.8 crores in Q3FY20. Gross profit margins have come down from 54.1% to 53.8% in Q3FY21. EBITDA for Q3FY21 stood at ₹1185 crores up by 10.4% as compared to ₹1073.7 crores in Q3FY20. EBITDA margins are at 24% as compared to 24.5% in Q3FY20. Profit before tax for the quarter at ₹284.3 crores in Q3FY21 as compared to loss of ₹527.4 crores in Q3FY20. Loss in Q3FY20 was due to one time impairment of non-current assets. Profit after tax for the quarter at ₹19.8 crores in Q3FY21 as compared to loss of ₹569.7 crores in Q3FY20. In Q3FY21 company has paid tax of 264.5 crores due to non-recognition of deferred tax assets on impairment. Indian business and Europe business have done very well for the company, reported revenue growth of 26% and 34% respectively. API business was flat to last year but down by 18% as compared to Q2FY21. We expect the company to improve its revenue growth in the USA market as well as Emerging market and will be able to maintain EBITDA margins in coming quarters. We have a positive outlook towards Dr. Reddy’s Laboratories ltd.

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