Dr Reddy’s Q2 net up 32%, beats estimates

Dr Reddy’s Q2 net up 32%, beats estimates

Mumbai: Dr Reddy’s Laboratories Ltd, India’s No. 2 drugmaker by sales, on Saturday reported a 32% jump in its net profit for the quarter ending September, topping estimates.

The New York-listed company reported a net profit of Rs287 crore ($64 million) in the fiscal second-quarter ended 30 September, up from Rs217 crore in the year-ago period, under international accounting standards.

It said strong sales in the domestic market helped boost profits.

Revenue rose 1.8% to Rs1,870 crore.

A Reuters poll of brokerages had estimated quarterly profit at Rs256 crore on revenue of Rs1,889 crore.

Dr Reddy’s Laboratories’ move to voluntarily recall four products from the US market last September had been expected to hurt sales numbers in the just-ended September quarter as the year-ago quarter benefited from sales of these products.

Sales in US, which contributes a third of the company’s revenue, rose 3% while European sales revenue fell 17%.

Sales in India jumped 25% in the quarter.

The company’s German unit Betapharm, which it bought in 2006 for $572 million, has been a drag on its earnings due to regulatory issues. Dr Reddy’s has been trying to turn around the unit, on which it took a hefty write-off last fiscal year.

Last month, a company executive told Reuters the drugmaker did not expect further write-downs for Betapharm.

Shares in the company have surged 41% this year, outpacing the 29% rise in the sector index and the 15.5% rise in the main index.