Dr Reddy's Labs Q2 PAT seen up 19% to Rs 365 cr
Dr Reddy's Laboratories' profit after tax is likely to go up by 19 percent year-on-year to Rs 365 crore in the second quarter of financial year 2012-13.
October 30, 2012 / 14:03 IST
Dr Reddy's Laboratories' profit after tax is likely to go up by 19 percent year-on-year to Rs 365 crore in the second quarter of financial year 2012-13.
Revenues are seen going up by 19 percent to Rs 2,704 crore from Rs 2,268 crore during the same period. Earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to rise by 4 percent YoY to Rs 529 crore in the quarter ended September 2012.But operating profit margin is likely to fall by 300 basis points YoY to 20 percent for the quarter.
Investors should watch for the US business that contributes 32 percent to total sales. In the previous quarter, US business fell 8 percent QoQ to USD 159 million but that was up by 38 percent YoY. The company failed to ramp up despite recent launches such as Geoden / Plavix / Seroquel generic + Lansoprazole OTC.Analysts on an average are expecting a bounce back. (Motilal Oswal expects revenues to grow by 25 percent to USD 171 million in Q2FY13 as against USD 160 million in previous quarter that will be led by ramp up off Plavix (USD 80 million), Toprol XL (USD 4 million) and Boniva / Lipitor generic (USD 4.5 million)).Analysts are expecting a strong growth in India (contributes 14 percent of sales and Russia (16 percent to sales). In previous quarter, Indian business grew by 18 percent YoY to Rs 348 crore with Russia / CIS rising 38 percent to Rs 416.7 crore in due to volume growth and traction in OTC. Analysts expect domestic business recovery to persist on improved field force productivity.Pharmaceutical Services and Active Ingredients or PSAI (which contributes 22 percent of sales) is expected to jump QoQ as it was flat in constant currency terms last quarter due to deferment of customer orders.Analysts feel the core earnings before interest, tax, depreciation and amortisation (EBITDA) could be impacted by higher SG&A and R&D expenses partly due to absence of Duty Entitlement Pass Book (DEPB) incentives. Recently Dr Reddy's Labs has decided to acquire Octoplus NV for 27.39 million euros - a dutch injectibles speciality drugs manufacturer - in an all cash deal.GuidanceManagement has re-iterated its topline guidance of USD 2.7 billion and US revenue guidance of USD 900 million in FY13 but that, analysts feel, will be challenging task for the company to achieve. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
