ICICI Direct's research report on Dr Reddy's Laboratories
Dr Reddy’s (DRL) portfolio includes pharmaceutical generics, APIs, custom pharmaceutical services, biosimilar and complex formulations. Revenue breakup: US (35%), India (20%), Russia and CIS (14%), Europe (8%), RoW (8%), PSAI (14%) and others (2%) • It has 13 formulation facilities, nine API manufacturing facilities, one biologics facility and several R&D centres across the globe.
Outlook
We maintain BUY due to 1) visible ramp up across geographies, 2) value accretive launches schedule, 3) ability to mitigate price erosion in US base business and 4) commentary for no major hurdles in Russia-CIS business. We value Dr Reddy’s at Rs 4800 i.e. 21x FY24E EPS of Rs 224.6 + NPV of Rs 83.4 for gRevlimid.
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