Dr Reddy’s Q3 net trebles, 9-mth revenue crosses $1bn

HYDERABAD: Dr Reddy���s Laboratories has gained entry into the $1-billion club with its nine months��� revenue of 2006-07 breaching the magical mark to touch Rs 4,951 crore (Rs 1,731 crore) even as its net profit trebled to Rs 187 crore for the quarter ended December 2006, as compared with Rs 62.8 crore in the corresponding period of the previous year. Taken sequentially, however, Dr Reddy���s Q2 net profit stands higher at Rs 279.8 crore.

While much of the buoyancy in revenues has been driven by authorised generics and overseas acquisitions, the company���s core business too has grown by 38% to touch Rs 820 crore in Q3 compared to Rs 590 crore in the same period last year. Though revenues from authorised generics contributed 22% to total revenues, they earned gross margins much lower than the company���s average margins.

Addressing a press conference, Dr Reddy���s CEO GV Prasad said: ���Fiscal 2007 has been a truly extraordinary year for DRL in many ways. For the first time in the history of the company, we have crossed the $1-billion in revenues.��� According to US GAAP numbers, the company posted revenue of Rs 1,543 crore in Q3 ended December 2006, against Rs 592 crore in the same period last year.

Asked if the company was in race for Merck���s generic global business, Mr Prasad said: ���We cannot comment on our acquisition strategies. We are neither denying it nor are we confirming it.���

The company launched ondansetron, generic version of Zofran, in the end of December 2006 with an 180-day exclusivity. Dr Reddy���s has already captured 55% share with sales of Rs 22 crore in Q3. Similarly, combined revenue from simvastatin and finasteride were Rs 338 crore and the 180-day exclusivity for these products expired on December 22, 2006. Fexofenadine too contributed Rs 48 crore taking the total North American market revenue to Rs 463 crore in Q3 against Rs 48 crore in the same period last year.

Revenues from betapharm touched Rs 266 crore in Q3, 2007 against Rs 255 crore in Q2, 2007. Also, the company���s custom pharma services business has crossed the $100-million mark for the nine months ended December 2006. In the core API business too, revenues grew 29% driven by sales of key products sertraline and sumatriptan.

The company incurred a capital expenditure of Rs 121 crore during Q3. The company has lined up a capex of $100 million for setting up SEZs.