BofA-Merrill downgrades Dr Reddy's to 'neutral'

Says slight increase in core profit estimates was being offset by fading US drug pipeline, moderating growth

Bank of America-Merrill Lynch downgraded its rating on Dr Reddy's Laboratories Ltd to "neutral" from "buy", saying "a slight" increase in core profit estimates was being offset by a fading US drug pipeline and moderating growth.

"We expect multiples to be capped due to modest growth prospects," the investment bank said in an email to clients on Friday.