Dr Reddy's lines up Rs 1,000 cr capex for current fiscal on growth outlook

Dr Reddy's Laboratories has earmarked a Capex of around Rs 1,000 crore for the current fiscal as it remains positive about sustaining its growth trends in the current fiscal, top company official said

Drug major Dr Reddy's Laboratories has earmarked a Capex of around Rs 1,000 crore for the current fiscal as it remains positive about sustaining its growth trends in the current fiscal and beyond, as per a top company official.

The Hyderabad based firm invested about Rs 1,000 crore in the 2020-21 fiscal.

"The Capex will be around the same numbers, maybe a bit higher if everything goes through," Dr Reddy's Laboratories CEO Erez Israeli said in an analyst call.

However, it depends on the COVID-situation that how much the company would be able to put in during the fiscal, he noted.

He was responding to a query whether the company's Capex for FY22 would be higher than FY21.

"We had about give or take a little bit less than Rs 1,000 crore of Capex in FY21," Israeli said.

On the growth outlook for the current fiscal, Israeli noted: "While the current business environment continues to remain uncertain owing to the global pandemic, we believe that the foundation is solid and there are multiple growth levers available for us to sustain growth trends in FY22 and beyond".

The drug maker's growth would be primarily driven by organic moves, focusing around pipeline monetisation, productivity enhancement, diversifications and capability ramp-up in marketing and digitalisation, he added.

"Further, our strong balance sheet allows us to continue to invest in the right set of inorganic moves to enable long-term growth," Israeli said.

Dr Reddy's has a net surplus cash of Rs 751 crore as of March 31, 2021, he added.

On the company's North America Generics business, Israeli said that as of March 31, 2021, the drugmaker had 95 cumulative filings pending approval with the US Food and Drug Administration (USFDA), which included 92 abbreviated new drug applications (ANDAs) and three new drug applications (NDAs).

"Overall, in the year (2020-21), we launched 28 new products, including one relaunch. We expect the strong new launches momentum to continue through the current year as well with a similar number of launches," he added.

On a full-year basis (2020-21), the North America Generics business sales stood at USD 948 million, a growth of 4 per cent over the previous year (2019-20).

The overall revenues of the drugmaker for FY21 stood at Rs 18,972 crore.