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Revenue
₹7,673 Cr
verified against source
Revenue YoY
14%
reported change
EBITDA
₹2,160 Cr
latest reported figure
Source
nse xbrl
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Dr. Reddy's delivered a steady Q1 FY25 with consolidated revenues of INR 7,673 crore, up 14% YoY, driven by strong US generics (up 19% YoY to $463M) and the Sanofi vaccine portfolio in India. EBITDA margin contracted 357 bps YoY to 28.2% due to higher SG&A (28% YoY increase) from investments in new initiatives and freight costs. PAT stood at INR 1,392 crore. Management expects full-year SG&A of 27.5-28% and R&D of 8.5-9% of sales. Key growth drivers include the Nicotinell acquisition (closing early Q4 CY24), Nestlé JV (operational from August 1), and biosimilar pipeline (Denosumab filing next year, Abatacept by end-2026). Risk: US price erosion and Middle East conflict impacting freight costs could pressure margins.
Colored figures show movement against the previous available record.
Guidance to track
- Management expects full-year SG&A as a percentage of sales to be in the range of 27.5% to 28%, despite Q1 being higher at 29.6%.
- R&D investment expected to be in the range of 8.5% to 9% of sales for the full fiscal year.
- Normal effective tax rate expected to be in the range of 24% to 25% for the fiscal year.
- Management expects North America generics to continue growing in single digits on a year-over-year basis, compensating for price erosion.
Risks flagged
- Pricing pressure in some key products partially offset volume gains in North America.
- Increased freight rates due to Red Sea route issues and air shipments added tens of crores to costs.
- SG&A jumped 28% YoY; analyst questioned if one-offs were included. Management attributed to investments and freight, but full-year guidance implies normalization.
- Free cash flow was lower due to reduced factoring in the US; management expects normalization but it introduces volatility.
Key quotes
- We have the capability to grow in single digits, meaning to compensate for any price erosion on year-to-year basis. That's what we did in the last six years, and this is what we are going to do.
- We are absolutely using the opportunity to invest more in the business, whether it's R&D or CapEx or new businesses.
- We don't see a reason to buy EBITDA, in which only the interest that you pay to the banks will be more than the EBITDA that we get. This kind of transaction, we will not do.
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