Recommendation: buy
Target Price: Rs5,000
Dr. Reddy’s Laboratories (Dr. Reddy’s) could experience 3% sequential revenue growth in the US in the March 2022 quarter. It captured ~13.5% market share in Vascepa during the quarter under review, up from ~9% in Dec 2021, i.e. its market share nearly tripled from ~4.5% in the June 2022 quarter. According to IU data, Dr. Reddy’s launched Vasostrict AG on February 22 and achieved a market share of approximately 8% in the Vasostrict injection vial market. This product will be key to US revenue growth in the quarter.
The company’s revenue could increase by 7%, EBITDA by 8% and profit after tax (PAT) by 15% compared to the year-ago quarter.
Important management information to monitor:
Generic API business insights
New launch pipeline
Likely total contribution of new launches
Strategy to gain market share
|
million rupees |
March 2022 estimates |
Annual change |
QoQ change |
| Revenue | 50,746 | 7% | (5)% |
| EBITDA | 10,915 | 8% | (9)% |
| Profit after taxes | 6,253 | 15% | (12)% |
Source: IIFL Research
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