Accumulate Dr Reddys Labs; target of Rs 3878: P Lilladher

Prabhudas Lilladher's report on Dr Reddys Laboratories

"Dr Reddy’s 4QFY15 performance were in line with our expectations. Against our expectations of a 12% growth in top line and 9% growth in bottomline, DRL reported a growth of 11% in topline and 8% bottomline growth. The company’s lower sales in Russia and CIS due to currency depreciation were largely offset by better sales in India formulations and European generics. PSAI sales of US$119m with 11% YoY growth was also a positive surprise in Q4FY15."

"While the company expects strong growth in non-US market, its key business in US, however, is dependent on the resolution of Form 483 observations in Srikakulam plant. Key pending approval such as Nexium remains uncertain due to similar reason. With better possibility of US approvals from other plants, we maintain ‘Accumulate’and retain TP at Rs 3,878", says Prabhudas Lilladher research report.

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