Dr Reddy's Laboratories Q2 net profit falls 17 per cent, stock falls

Dr Reddy's Laboratories, the home-grown pharmaceuticals major, on Wednesday reported a 16.82 per cent fall in its consolidated net profit at Rs 574.1 crore for the quarter ended September 30, 2014 on account of higher expenses.

The company had posted a consolidated net profit of Rs 690.25 crore in the corresponding quarter of the previous 2013-14 fiscal.

Net income during the reporting period stood at Rs 3,587.81 crore as against Rs 3,357.45 crore in the year-ago quarter, Dr Reddy's Laboratories said in a filing to Bombay Stock Exchange.

During the second quarter, the company said its selling, general and administrative expenses increased to Rs 1,067.33 crore as against Rs 973.68 crore in the same period of FY14.

Expenses on R&D stood at Rs 411.3 crore, an increase of 37 per cent year-on-year.

"The increase is in line with our planned scale-up in development activities," the drug maker said.

Dr Reddy's, which is the country's second largest drug maker by revenue, said its global generics business revenues stood at Rs 2,890 crore, up 9 per cent from the year-ago period driven mainly by the domestic market and rest of World territories, primarily Venezuela, and North America.

Revenues from the domestic market stood at Rs 480 crore, up 14 per cent from the same period of the previous fiscal. The growth was primarily driven by healthy volume expansion of focus brands, some of which are also listed under the National List of Essential Medicines portfolio, the drug major said.

North American revenues stood at Rs 1,430 crore, up 8 per cent, while those of emerging markets were up 14 per cent, at Rs 830 crore.

Generic sales from the country stood at Rs 480 crore with a growth of 14 per cent, the company said.

Income from Pharmaceutical Services and Active Ingredients vertical declined by 6 per cent to Rs 640 crore.

Shares of Dr Reddy's Laboratories were trading at Rs 3,027.95 a piece in afternoon trade, down 1.71 per cent from Tuesday's cloase on the BSE.