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Revenue
₹8,545 Cr
verified against source
Revenue YoY
11%
reported change
EBITDA
₹2,278 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Dr. Reddy's Q1 FY26 results showed 11% YoY revenue growth to INR 8,545 crore, driven by steady performance across most markets except US generics. EBITDA margin of 26.7% declined 149 bps YoY due to price erosion in lenalidomide and higher SG&A from NRT and nutraceutical investments. PAT grew 2% YoY to INR 1,419 crore. Management expects lenalidomide sales to drop sharply after Q2, with semaglutide launch in Canada targeted for early 2026 pending approval and IP clearance. The company aims to maintain 25%+ EBITDA margins through cost optimization, but near-term headwinds from generic pricing and elevated SG&A persist. Risk: Lenalidomide revenue decline could pressure margins more than anticipated if new launches underperform.
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Guidance to track
- Expects approval between end-Oct and early-Nov 2025, with launch at LOE in Jan 2026, subject to IP clearance and approval.
- R&D investments expected in this range for the full fiscal year.
- Capital expenditure for the full year expected in this range, primarily for peptides and biosimilars.
- Aims to maintain EBITDA margin north of 25% for the base business, with semaglutide expected to be accretive.
Risks flagged
- Lenalidomide sales expected to drop significantly after Q2 FY26; magnitude depends on pricing and competitor behavior.
- Canadian launch contingent on patent litigation outcome in India and FDA approval; any delay could push revenue to later quarters.
- Base US business faces ongoing price erosion; management expects flat to single-digit growth but uncertainty remains.
- SG&A at 30% of sales in Q1; management targets 28-29% for full year, but NRT and nutraceutical investments could keep it higher.
Key quotes
- We are aiming that the base business will be always north of 50%. In Semaglutide, it should be even more than that on the gross margins and EBITDA, obviously, like always 25% or north of it.
- The idea is between growing the base semaglutide and the expenses as well as a success BD, we will kind of manage to make sure that the growth is coming in the right way.
- We are not desperate. We are actually very comfortable with what we do. We knew that Lina will come. No, we are not planning to cut expenses that are supporting the growth of the company.
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