Dr Reddy’s Q1 Results Preview: PAT may grow up to 15% YoY, revenue to surge up to 19%

Dr Reddy’s Laboratories is set to announce its Q1FY26 results on Wednesday, July 23. Brokerages project a mixed bag of earnings led by steady revenue growth, resilient domestic demand, and moderated US sales. Profit after tax (PAT) is seen in the range of Rs 1,399 crore to Rs 1,659 crore, reflecting a YoY growth between -2% and 15%. Revenue estimates hover between Rs 8,491 crore and Rs 9,094 crore, indicating a broad-based annual growth of 10–19%.

The estimates of YES Securitie, PhillipCapital, Nuvama Institutional Equities and Kotak Institutional Equities have been taken into account.

Here;s what brokerages recommended:

YES Securities

Dr Reddy's Q1 PAT is estimated at Rs 1,598 crore, reflecting a YoY growth of 14.8% and a marginal sequential (QoQ) uptick of 0.3%. The revenue for the quarter is pegged at Rs 8,616 crore, registering a 12% YoY increase and a 1% QoQ rise.


The company's earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to come in at Rs 2,229 crore. It is expected to go down by 181 bps YoY while rising by 154 bps sequentially.

"Revlimid trajectory would essentially determine US performance and we expect modest growth though still lower YoY as peak Revlimid sales might be behind. Gross margin had an element of one-off in Q4 to the extent of 300 bps which would reverse even as NRT consolidation implies margin would be below last year," this brokerage said.

Phillip Capital

The company's PAT is expected to grow 14% YoY and QoQ to Rs 1,659 crore in line with strong sales and operating performance. Revenue from operations may come in at Rs 9,094 crore, rising 19% YoY and 7% QoQ. Phillip Capital attributed this to the integration of Nicotinell acquisition, steady 8% growth in US sales supported by strong Revlimid (at $180 million vs $150 million last year), 11% growth in India and favorable currency.

EBITDA is pegged at Rs 2,591 crore, likely up 19% YoY and a strong 21% QoQ while the EBITDA margin for the quarter could be reported at at 28.5%, expanding by 16 basis points on a YoY basis and a substantial 325 bps on a QoQ basis.

"Margins to remain stable at 28.5% as the price pressure in gRevlimid is compensated by favourable currency strong growth in Domestic formulation business, leading to a 19% YoY growth in EBITDA," this brokerage said.

Nuvama

Nuvama expects a PAT of Rs 1,399 crore in the quarter, marking a decline of 2% YoY and 12% QoQ. Revenue may stand at Rs 8,659 crore, registering a 13% increase YoY and a modest 2% rise QoQ.

EBITDA may rise to Rs 2,255 crore, up 6% YoY and 6% QoQ.

"Revenue growth to be driven by growth in the India business. We expect gross/EBITDA margins to contract 340bp/130bp YoY to 57%/26.4%. We build EBITDA/PAT growth to be 8%/-1% YoY," this brokerage said.

Kotak Equities

Kotak Equities, in its Q1FY26 preview, expects the company to report a PAT of 1,477 crore, marking a growth of 6.1% YoY and 7.3% QoQ. Net sales are projected at Rs 8,491 crore, rising 10.3% YoY but showing a slight sequential dip of 0.4%.

EBITDA is estimated at Rs 2,105 crore, reflecting a marginal decline of 1.2% YoY but an increase of 1.5% QoQ. Meanwhile, the EBITDA margin is seen at 24.8%, contracting by 289 basis points YoY but improving by 46 basis points sequentially.


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