Dr Reddy's Lab Q3 PAT drops 14% YoY to Rs 1,210 cr

Dr Reddy's Laboratories reported a 14.4% decline in consolidated net profit to Rs 1209.8 crore despite of 4.4% jump in revenue to Rs 8,716.8 crore in Q3 FY26 over Q3 FY25.

The revenue growth was broad-based across key markets, except for North America Generics which reported a decline primarily on account of lower Lenalidomide sales. Growth was further aided by favourable foreign exchange rate movements.

Profit before tax (PBT) dropped 17.68% YoY to Rs 1,542.9 crore during the quarter.

EBITDA stood at Rs 2,049.3 crore, registering de-growth of 12.84% compared with Rs 2351.1 crore posted in corresponding quarter last year. EBITDA margin reduced to 23.5% in Q3 FY26 as against 26.7% in Q3 FY25.

Revenue from global generics increased 7% YoY to Rs 7,911.3 crore during the quarter.

In Q3 FY26, revenue from North America declined 20% YoY to Rs 2,964.4 crore, primarily due to lower Lenalidomide sales and higher price erosion in certain key products. The North America region accounted for 34% of total revenue during the quarter.

Revenue from Europe region increased 20% YoY to Rs 1447.6 crore during the quarter, supported by new generic product launches, growth witnessed in the nicotine replacement therapy (NRT) portfolio and favourable forex movements. These positives were partly offset by pricing pressure in generics.

Revenue from India jumped 19% YoY to Rs 1,603.2 crore in Q3 FY26, driven by strong performance of the innovation portfolio, new brand launches, price increases, higher volumes, and contributions from the recently acquired Stugeron portfolio. India contributed 18% of total revenue during the quarter.

Revenue from emerging markets surged 32% YoY to Rs 1896.1 crore, largely driven by new product launches across markets, aided by favourable forex.

R&D Expenses stood at Rs 614.9 crore during the quarter, registering a 8% YoY decline due to reduced development spending in biosimilars following completion of a large part of the investments related to Abatacept. R&D spends remain focused on complex generics, biosimilars, peptides and novel biologics. The quarters R&D spend also included a one-time provision related to new labour codes. Excluding this one-off item, R&D expenditure stood at 6.8% of revenues for the quarter.

Co-chairman & MD, G V Prasad said: "Our growth in Q3FY26 was supported by continued momentum in our branded businesses, aided by favourable forex, thus offsetting the impact of lower Lenalidomide sales. We continue to focus on disciplined execution of our strategic priorities of base business growth, pipeline advancement, operational efficiencies, and select inorganic opportunities, to create long-term value for our stakeholders."

Hyderabad-based Dr. Reddys Laboratories is a global pharmaceutical company. It offers a portfolio of products and services including APIs, generics, branded generics, biosimilars and OTC.

The scrip rallied 4.48% to Rs 1207.30 on the BSE.

Powered by Capital Market - Live News