Q3FY24 Preview: Dr. Reddy’s Laboratories: Revenue seen at ₹69,314 Million, PAT at ₹13,197 Million

29 Jan 2024 , 11:03 AM

Result date: January 30, 2024

Recommendation: Reduce

Target price: ₹5,300

Analysts at IIFL Capital Services believe Dr. Reddy’s Laboratories (DRL) could register Revlimid sales at $120 Million, steady on a sequential basis. DRL’s base US business will likely increase sequentially from $264 Million to $270 Million, led by volume growth in base products (Nuvaring, Vascepa, Amitiza) and higher Mayne contribution. In the domestic business, there could be perennial under-performance versus IPM, led by a weak portfolio. Margins could remain steady sequentially, as analysts at IIFL Capital Services expect Revlimid sales to be stable.

DRL’s Profit After Tax or PAT could decline 11% sequentially.

Important management insights to watch out for:

• Commentary on gIxempra launch
• Updates on US base business
• Outlook on ex. Revlimid margin

₹ Million	December 2023 estimates	YoY change	QoQ change
Revenue	69,314	2.4%	0.7%
US revenue (USD Million)	390	4.8%	1.7%
India revenue	12,063	7.0%	1.7%
EBITDA	20,005	(2.7)%	0.4%
EBITDA margin	28.9%	(151) bps	(9) bps
Profit After Tax	13,197	4.7%	(11.2)%

Source: IIFL Research