No immediate respite seen for Dr Reddy's

With concerns on US FDA and profitability under pressure, stock price may remain range-bound

Ujjval Jauhari  |  New Delhi 

While not much was expected from Dr Reddy’s March quarter results, the higher-than-estimated decline in profitability was a disappointment. With US FDA-related issues remaining unresolved, the near-term outlook continues to be subdued.  Revenues at Rs 3,554 crore for the March quarter were down 5% year-on-year (y-o-y), and were lower than Rs 3,683 crore estimated by analysts polled by Bloomberg. This was the fifth consecutive quarterly decline on a y-o-y basis, in revenues. Earnings before interest, tax, depreciation and amortisation (Ebitda) at Rs 630.3 crore fell well ...

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No immediate respite seen for Dr Reddy's

With concerns on US FDA and profitability under pressure, stock price may remain range-bound

Even as not much was expected from Dr Reddy's March quarter results, the higher than estimated decline in profitability was a disappointment. With US FDA related issues remaining unresolved, the near-term outlook continues to be subdued. Revenues at Rs 3,554 crore for March quarter were down five per cent year-on-year, and came lower than Rs 3,683 crore estimated by analysts polled by Bloomberg. This was the fifth consecutive quarterly decline on a year-on-year basis, in revenues. Earnings before interest, tax, depreciation and amortisation (Ebitda) at Rs 630.3 crore was short by a bigger margin as compared to expectations of Rs 779 crore. Consequently, net profit at Rs 312.5 crore was significantly lower than estimates of Rs 385 crore. The major pressure point continues to be US sales. With the company's three Indian facilities under US FDA's warning letter, approvals for new product launches have been delayed thereby impacting the company's growth. Since US generic sales contribute . While not much was expected from Dr Reddy’s March quarter results, the higher-than-estimated decline in profitability was a disappointment. With US FDA-related issues remaining unresolved, the near-term outlook continues to be subdued.  Revenues at Rs 3,554 crore for the March quarter were down 5% year-on-year (y-o-y), and were lower than Rs 3,683 crore estimated by analysts polled by Bloomberg. This was the fifth consecutive quarterly decline on a y-o-y basis, in revenues. Earnings before interest, tax, depreciation and amortisation (Ebitda) at Rs 630.3 crore fell well ... image
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