Dr. Reddy’s Q1 revenue fell 5.6% as a INR 240 crore semaglutide provision and lower lenalidomide sales hit results. The base business grew double digits across geographies.
Alpha Score of 31 reflects weak overall profile with moderate momentum, poor value, weak quality. Based on 3 of 4 signals – score is capped at 90 until remaining data ingests.
Dr. Reddy’s Laboratories reported a 5.6% revenue decline in its fiscal first quarter, as a provision tied to semaglutide API issues and fading lenalidomide sales weighed on results.
The Hyderabad-based drugmaker posted consolidated revenue of INR 8,071 crores for the quarter ended June 30. EBITDA margin came in at 12.5%, CFO Mannam Venkatanarasimham said on the earnings call. A provision of INR 240 crores for inventory and other costs linked to recent semaglutide API-related challenges contributed to the margin compression.
Lenalidomide, the generic version of Revlimid that had been a major profit driver, contributed less than in the year-ago period. Venkatanarasimham flagged the impact explicitly, noting the quarter reflected “lower lenalidomide revenues, which contributed to the corresponding period last year.”
Stripping out lenalidomide, the base business posted healthy double-digit growth across all key geographies, including North America. New product launches and favorable currency movements supported the underlying momentum, Venkatanarasimham said.
The company translated financial figures into U.S. dollars using a convenience rate of INR 94.66, the exchange rate as of June 30.
Dr. Reddy’s has an Alpha Score of 52 out of 100 from AlphaScala, a mixed rating. The stock page is C stock page.
Analysts on the call pressed for detail on the semaglutide supply and regulatory path. Dr. Reddy’s CEO Erez Israeli and the management team did not provide a timeline for resolution during the prepared remarks. The API challenge adds uncertainty to a quarter where the core business otherwise held up.
Investors will watch for updates on the semaglutide situation and whether the base business growth rate can sustain without the lenalidomide tailwind. The next quarterly report will show if the margin recovers from the one-off provision.
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