Dr Reddy's Labs plunged 10%, ends as top Sensex loser

NEW DELHI: Shares of drug firm Dr Reddy's Labs closed 10 per cent lower on Wednesday, a day after it posted a 75.6 per cent drop in net profit for June quarter. Consolidated profit stood at Rs 153 crore, much below a Rs 480 crore estimate that analysts had projected in an ET Now poll.

Revenues from the global generic segment declined 14 per cent year on year to Rs 2,660 crore, mainly because of lower contribution from North America and loss of sales from Venezuela, the company said in a regulatory filing to Bombay Stock Exchange (BSE).

The company had reported a net profit of Rs 626 crore for the same quarter last year. This marks the second straight quarter of decline in profit for the pharma giant.

At 9:20 am, shares of the company were trading at Rs 3,050 apiece, down 8.21 per cent from its previous close on BSE. It was also the top loser of the Sensex.

Although the figures are discouraging, the poor result was not unexpected. In a recent report, Edelweiss Securities had predicted the Q1 numbers to be disappointing amid competition to Valcyte and Vidaza drugs, which it said, is capable of eroding the base business.