bullish
high
✓ Verified against BSE filing
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
79%Questions answered0Evaded / deflected12Questions auditedContradictedNumbers vs filing
Answered
Medium priority
Why did cash flow from operations decline sequentially despite similar working capital?
Asked by Kunal Damesha, Macquarie Capital
Management gave a specific reason (factoring fluctuation) and confirmed it would normalize.
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Question
First one, on the cash flow from operations, which seems to have come down meaningfully, despite our working capital, is largely similar to the last quarter, right? So what is driving the sequential moderation in cash flow generation?
Parag Agarwal, CFO
The reason the free cash flow is a bit on the lower side is because of fluctuation in factoring. You know, we do the factoring in various markets, largely in the US, depending on the interest rates and the benefit we get, and because of that, we have rolled back factoring a little bit in this quarter.
Answered
High priority
Is there a one-off in the step-up in SG&A expense this quarter?
Asked by Kunal Damesha, Macquarie Capital
Management identified specific one-offs and provided a full-year guidance range.
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Question
Second one, on the SG&A expense, while you have highlighted that we are incrementally investing, you know, in the new horizon growth levers, et cetera, but there is a step jump in SG&A expense. So is there any one-off included in this quarter's SG&A expense?
Parag Agarwal, CFO
There are also some one-offs, like increase in freight rates because of some route issues and the Red Sea. Also a few one-offs in farm. Overall, we are confident that our SG&A percentage is going to be within the range of 27%-28% for the full year.
Partial answer
High priority
Are you on track for 20+ US launches? How many of 25 first-to-file will launch in 2-3 years?
Asked by Kunal Damesha, Macquarie Capital
Confirmed on track for launches but could not quantify first-to-file launches.
deferred to laterno number given
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Question
I think you launched three products in this quarter, and you know, I think our usual guidance is around 20+ products, right? So are we on track to achieve that? And secondly, you also mentioned that we have roughly 25 first to file filings according to us, right? So out of this 25, how many of these are expected to be launched in, let's say, next two to three years?
Erez Israeli, CEO
So the answer to the first part, yes, we are on track. How many exact first to file, anybody knows? I don't know exactly to tell you, Kunal. We'll come back to you.
Partial answer
High priority
How big can the OTC business be by FY27-28? Will more acquisitions be needed?
Asked by Neha Manpuria, Bank of America
Gave current size and ambition but no specific FY27-28 target; later confirmed need for more acquisitions to reach $1B.
no specific timelinevague on billion target
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Question
Now, with the acquisition of the NRT portfolio, the Nestlé JV going online, how should we think about the potential size of the OTC business, let's say in fiscal 2027, 2028? How big do you think this business can be? And are there any more acquisitions or capital allocation that you see in the consumer healthcare business to make it larger?
Erez Israeli, CEO
The Northstar, the new acquisitions, once come, will be somewhere around the $300 million. So altogether it's $600 million dollar plus, growing. Likely that we want to build on the platform of Northstar and to add more assets in the future. So, we see it as obviously a business that we speak in billions in the future.
Answered
High priority
What are the timelines for Denosumab and Abatacept filings and launches?
Asked by Neha Manpuria, Bank of America
Provided specific timelines for both products.
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Question
If you could give us some color on the timelines for filing of these assets, and therefore, when should we expect launch of both these products?
Erez Israeli, CEO
Denosumab is next year, and what are the other products that you are selling? Abatacept should be December 26th, hopefully, and depends on the approvals or marks beginning of 27th, the calendar.
Answered
High priority
What drove the $50-60 million QoQ jump in US revenue? New launches or base business?
Asked by Amey Chalke, JM Financial
Clearly attributed the majority to base business growth.
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Question
For the quarter, we have seen a good quarter-on-quarter jump, almost $50 million-$60 million. Is it possible for the management to give some breakup, how much would be contributing from the new product launches, which we have recently done, and how much would be from the base business improvement?
Erez Israeli, CEO
So most of it is from the base business. Most of it is the products that we had before, and the contribution of the three products helped the growth, but the lion's share of the growth came from products that we had before.
Answered
Medium priority
What is the base business growth in India excluding the vaccine acquisition?
Asked by Amey Chalke, JM Financial
Provided a clear estimate of mid-single digits.
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Question
In the opening remarks, we said that some of it is coming from the vaccine business, which we acquired. Is it possible to quantify how much will be the base business growth?
Erez Israeli, CEO
Yeah. So it's, let's say without the vaccine, it's probably mid-single digits, without it.
Partial answer
Medium priority
What is the cost spend on biologics and when will meaningful sales start?
Asked by Damayanti Kerai, HSBC
Gave percentage of R&D and profit but not absolute spend; confirmed 2027 timeline.
no absolute spend numbervague on profit share
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Question
Can you let us know what is the kind of spend you are doing for this line of business? And, you earlier mentioned meaningful sales should be starting from 2027, right?
Erez Israeli, CEO
On biologics, we have just maybe just to frame what we call biologics in the company. We have biosimilars, which is about, I think, if I'm not mistaken, 20%? No, of the R&D. About 20% of the R&D and about 10% of the profit.
Partial answer
Medium priority
What is the investment in Aurigene biologic facility and is it for CDMO?
Asked by Surya Patra, PhilipCapital India Private Limited
Confirmed purpose but gave only a vague range for investment.
no exact number given
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Question
My first question is on the Aurigene biologic facility, what we have inaugurated. So, what is the kind of how big is the investment there? And also I wanted to understand, is it for the biosimilar pipeline, what we have created, or it is targeted towards the CDMO opportunity?
Erez Israeli, CEO
That specific investment is for the CDMO activity of the biologics for Aurigene. So that's the primary purpose of this. The level of investment is a few hundred INR crores. I don't remember exactly how much.
Answered
High priority
How will you deploy the significant cash and cash flow over the next 2-3 years?
Asked by Shyam Srinivasan, Goldman Sachs
Provided a clear capital allocation strategy and amount available.
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Question
We have $2 billion in cash equivalents. We're gonna pay for this NRT, which I think the upfront payment will likely be happening. But even after that, we seem to have lots of cash, and cash flow generation. So just want to understand, you know, the next two, three years will likely.
Erez Israeli, CEO
First, we believe that we have about $2.5 billion that we can invest in organically. The primary way to use it is less of mergers and acquisitions, and more about collaborations, licensing, and from time to time, we will buy also assets or rights to the assets.
Answered
High priority
Will Dr. Reddy's change its valuation philosophy for India acquisitions?
Asked by Shyam Srinivasan, Goldman Sachs
Clearly stated willingness to do deals if they meet return thresholds.
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Question
In the past, in terms of deals in India, valuations have been a hurdle. Do you think our philosophy will likely change now if you were to look at transactions in India? Recently, many of your peers have done, can I say, high valuation acquisitions. Is it something that Dr. Reddy's will be also willing to look at?
Erez Israeli, CEO
We are looking at all the deals in India. If the deal is better than across the capital, absolutely, we'll do it, and India will be absolutely a priority.
Partial answer
Medium priority
What is the current and planned capacity of the Bachupally biologics facility?
Asked by Kunal Damesha, Macquarie Capital
Gave target capacity but was unsure of current capacity and did not address pipeline coverage.
uncertain about current capacityno confirmation on pipeline coverage
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Question
I believe we also undertook the expansion of our biologics facility, right? So is that complete now? And with that completion, if you can help with the current capacities, is it more than enough to cover us for the next two, three biologics or biosimilar that we have in pipeline?
Erez Israeli, CEO
We are still investing in our Bachupally facility. The intent is to become something like 60 kiloliter in that facility. This probably will take us additional two years to reach that level. I think 15, if I remember, 15,000.
Quantitative claims vs filed numbers
| Claim | Management said | Filing | Verdict |
|---|---|---|---|
| OTC business currently about $320 million | 320 | 7,673 | Understated vs filing |
| Northstar acquisition will add about $300 million | 300 | 7,673 | Understated vs filing |
| India base business growth will be double digits this year | 10% | 14% | Understated vs filing |
Filed figures sourced from Screener.in. Claims within a small tolerance of the filing are marked “matches filing”.