Dr Reddy’s Share Price Surged Over 2% After Release of Q2 FY25 Results

On November 06, 2024, Dr Reddy’s share price surged over 2% and touched the day high of ₹1,312.00 at 10:15 AM. The surge in share price came after Dr Reddy’s Laboraotories released its Q2 FY25 results, wherein it reported a 15% decline in net profit, which stood at ₹1,255 crore. The drop in profit was primarily attributed to pricing pressures in the highly competitive North American market, the company’s largest revenue-generating region.

On the revenue front, Dr Reddy’s saw a 17% year-on-year growth, with total revenue reaching ₹8,016 crore. The company largely credited the sales growth in North America to an increase in volumes. However, this growth was partially offset by price erosion in the market.

EBITDA for the quarter rose by 5% year-on-year, amounting to ₹2,280 crore for the July-September 2024 period. Additionally, the company’s EBITDA margin saw a slight improvement, reaching 28.4% during the same period.

Co-Chairman & MD, G V Prasad said: “We delivered another good quarter and maintained the growth momentum across businesses. We made progress on our future growth drivers, operationalised our venture with Nestle and completed the acquisition of Nicotinell and related brands. We will continue to drive efficiency, strengthen our core businesses, and positively impact patient lives through science and innovation.”

Investment in Subsidiary

The Board of Dr Reddy’s Laboratories approved a fund infusion of up to ₹600 crore in equity shares of Dr Reddy’s Laboratories LLC, a step-down wholly-owned subsidiary in Russia. This capital will be used to meet the working capital requirements of the Russian subsidiary.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.