Dr Reddy Labs Q4FY23 PAT up 10-fold at Rs960 crore as higher revenues imply boost to contribution
Reddy Labs reported 15.4% growth in total revenues for the March 2023 quarter on consolidated basis at Rs6,315cr. On a sequential basis, the revenues were down -6.99%. Reddy Labs operates in a sector where the costs are largely absorbed and additional sales boost the contribution. In Q4FY23, the gross margin spurted from 52.9% to 57.2% yoy showing how the gross profit got a boost from higher sales. This led to profit surge.
Reddy Labs reported EBITDA for the fourth quarter at Rs1,631 crore implying EBITDA margins of 25.9% for the quarter. The R&D spending stood at Rs537 crore in the quarter translating into 8.5% of revenues, a healthy measure by global standards too. The top line and bottom line performance was largely driven by the US generics business.
Financial highlights for Mar-23 compared yoy and sequentially
| Dr Reddy's Labs | |||||
Rs in Crore | Mar-23 | Mar-22 | YOY | Dec-22 | QOQ |
| Total Income (Rs cr) | ₹ 6,315 | ₹ 5,475 | 15.35% | ₹ 6,790 | -6.99% |
| Operating Profit (Rs cr) | ₹ 1,238 | ₹ 152 | 715.01% | ₹ 1,643 | -24.63% |
| Net Profit (Rs cr) | ₹ 960 | ₹ 97 | 889.79% | ₹ 1,244 | -22.82% |
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| Diluted EPS (Rs) | ₹ 57.68 | ₹ 5.83 |
| ₹ 74.76 |
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| OPM | 19.60% | 2.77% |
| 24.19% |
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| Net Margins | 15.20% | 1.77% |
| 18.32% |
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The yoy growth in top line was an imposing 27% for North America, 12%for Europe and 32% for India. The US still accounts for nearly half of revenue with India accounting for a fourth. The active ingredients business was just up 3% on a yoy basis. However, the US revenues were lower on a sequential basis which shows as lower sales.