Dr Reddy'S Laboratories Ltd

Latest Results (13.11.2025):

Dr. Reddy's Laboratories Ltd reported its consolidated Q1FY26 financial results for the quarter ended June 30, 2025. The company achieved a consolidated revenue of ₹85,452 million with an 11% year-on-year increase and flat quarter-on-quarter performance. While robust growth in several segments and regions fueled the top line, the company experienced some margin compression with its gross margin at 56.9% compared to 60.4% a year ago. Profitability remained steady with a slight YoY increase in profit before tax and continued focus on new product launches and strategic collaborations.

Revenue Performance

Consolidated revenues stood at ₹85,452 million, up 11% YoY and flat QoQ. Growth was spread across segments with India and Emerging Markets recording 11% and 18% YoY growth respectively, reflective of a balanced contribution from both branded markets and the acquired Consumer Healthcare portfolio in Nicotine Replacement Therapy.

Margin Trends

The quarter’s gross margin decreased to 56.9% from 60.4% YoY, although it saw a QoQ improvement from 55.6%. The decline was partly offset by effective management of SG&A expenses, which increased 13% YoY and 7% QoQ, and R&D expenses aligned at 7.3% of revenues.

Profitability Metrics

Profit before tax reached ₹19,047 million, marking a modest 1% rise YoY despite a 5% decline QoQ, while the profit after tax attributable to equity holders climbed to ₹14,178 million (up 2% YoY, but down 11% QoQ). EBITDA was robust at ₹22,784 million, representing 26.7% of revenues.

Regional and Segment Highlights

Global Generics drove most of the revenue at ₹75,620 million (10% YoY growth), with North America facing an 11% YoY decline largely due to pricing pressures on key products. Europe saw impressive growth at 142% YoY, while India and Emerging Markets recorded healthy gains aided by new product launches. Additionally, the Pharmaceutical Services and Active Ingredients segment reported a 7% YoY increase, despite a QoQ decline due to seasonal factors.

Strategic Initiatives and Launches

Key business milestones include expanded partnerships with Alvotech and Sanofi, the launch of new brands such as Sensimune in India, and multiple product introductions across regions. These initiatives underscore the company’s focus on pipeline delivery, productivity improvements, and strategic market expansion.