Pharma major Dr. Reddy’s Laboratories Ltd. has reported a more than 71% increase in consolidated net profit, as per Indian Accounting Standards, for the quarter ended March on the back of improved showing in the key global generics business, a turnaround in Europe market and new launches in North America.
The net profit stood at ₹781.1 crore against ₹455.4 crore in the corresponding period of the previous fiscal. Total income increased almost 10% to ₹4,522.5 crore. Total revenue from operations was more than 10% higher at ₹4,448.9 crore.
The sales was the highest for any quarter thus far, said chief financial officer Saumen Chakraborty, who, along with co-chairman and managing director G.V. Prasad and COO Erez Israeli addressed a virtual press conference on Wednesday.
On the performance, Mr. Chakraborty said global generics sale during the quarter was ₹3,639.8 crore (₹3,038.4 crore) with the year-on-year growth in North America and Europe being 21% and 80% each.
New launches, scale up of existing products and a favorable forex rate, which was partially offset by price erosion, helped the growth in the North America generic market.
Volumes were higher partially due to COVID-19 related stocking up. During the quarter, the company had launched five new products.
For the full fiscal, the consolidated net profit was nearly 4% higher at ₹2,026 crore. Total income was almost 15% higher at ₹18,137.6 crore while total revenue from operations was 13% more at ₹17,517 crore .
“FY 20 has been a very positive year for the company. Progress made during the year includes VAI (Voluntary Action Indicated by the USFDA) status for CTO-6 (API facility in Srikakulam), healthy product pipeline build-up, productivity improvement and a strong financial performance across our businesses,” said Mr. Prasad, who has been re-appointed as wholetime director designated as co-chairman and MD. The re-appointment, approved by the board, is for a further period of five years, from January 30, 2021 to January 29, 2026, subject to approval of shareholders at the ensuing AGM.
On COVID-19 impact for the pharma industry, Mr. Prasad said supply chain disruption was there in the initial days. Also, the pandemic is likely to impact the primary demand as in the last two months very few patients were able to meet doctors.
At Dr.Reddy’s, a few products related to COVID-19 are under development. “We are going to develop Hydroxychloroquine… had soft launched as part of CSR,” he said.
The board of directors recommended a dividend of ₹25 per equity share (face value of ₹5 each) for 2019-20.