NEW DELHI: Dr Reddy’s Laboratories is likely to post 10-16 per cent rise in profit for the December quarter on an 8-10 per cent jump in sales. The drug major will report its quarterly numbers on Monday.
Edelweiss Securities expects profit to rise 16.6 per cent year-on-year to Rs 565 crore compared with Rs 485.20 crore. The brokerage sees revenue rising 10.2 per cent to Rs 4,243 crore from Rs 3,850 crore.
“We expect US revenue ($220 million) to grow 9 per cent QoQ in constant currency terms, as some sales from Q2 were pushed to the quarter and the company launched five products. We expect India to grow 15 per cent YoY, faster than the IPM, following the launch of biosimilar Avastin and entry into the Nutrition segment. we expect Ebitda margins to remain buoyant at 23 per cent, as cost rationalisation continued to drive operating leverage,” it said.
A steady market share gain in generic Suboxone is expected to benefit Dr Reddy’s, said Centrum Broking.
The brokerage expects the drug maker to report 11.1 per cent rise in profit at Rs 538 crore. It sees sales rising 8.3 per cent to Rs 4,099 crore and Ebitda 26.8 per cent to Rs 1,020 crore.
Among geographies, brokerage Narnolia expects revenue from the domestic business to grow 13 per cent YoY to Rs 762 crore on account of traction in volumes. Europe and emerging markets are expected to grow at 26 per cent and 4 per cent, respectively. US revenue is seen falling 4 per cent to $200 million on account of ban on Rantidine and lower contribution from the new launches, owing to smaller ticket size.
“With Amneal Pharmaceuticals receiving the USFDA ANDA approval for Nuvaring, the only attractive opportunity for DRL seems to be the Copaxone launch in the short term,” it said.
Meanwhile, PhillipCapital expects sales to rise by a mere 4.2 per cent to Rs 4,011 crore compared with Rs 3,850 crore in the same quarter last year, hurt by continued competition its key products facing in the US market. It expects margins to drop to 20.9 per cent from 29.6 per cent in September quarter and 21.9 per cent in the year-ago quarter. This contraction will primarily be due to competition in the US generic business that is seen resulting in a flat Ebitda, it said.
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