Q4FY23 Preview : Dr. Reddy’s Laboratories: Revenue seen at Rs. 62,673 million, PAT at Rs. 12,170 million

9 May 2023 , 09:44 AM

Result date: 10^th May, 2023

Recommendation: Add

Target price: Rs. 4,400

Dr. Reddy’s Laboratories (DRL) could witness decline in Revlimid sales, which is estimated at $90 million in Q4 versus $135 million in Q3. Analysts at IIFL Capital Services expect the company’s revenue to grow 20% over the year-ago quarter, on the back of strong growth in US generics and improved growth in India formulations. 

Decline in raw material costs such as APIs & organic solvent would aid overall margins of the company. EBITDA margin could expand 643 basis points as compared to the year-ago quarter. Sequentially though overall performance could be impacted by weakness in Revlimid sales.

The company’s Profit After Tax or PAT could surge 92% over the year-ago quarter.

	March 2023 estimates	YoY change	QoQ change
Revenue (Rs. mn)	62,673	20%	(7)%
EBITDA (Rs. mn)	16,772	58%	(18)%
EBITDA margin (%)	26.8	643 bps	(361) bps
Profit After Tax (Rs. mn)	12,170	92%	(3)%

Source: IIFL Research