Dr Reddys Labs - Q3FY13 Preview - HDFC Securities

DRL could report good revenue growth during the quarter supported by strong growth in its US and Russia generics and in PSAI. US business could grow by 20-22% led by Tecrolimmus, Toprol, Singular, Lansoprazole and Fondaparinux. Increase market share in new product launches like Boniva, Plavix, Toprol XL, Propecia & Azacitidine could also aid in higher revenue growth. Patent expiries in regulated markets could give a fresh boost to the PSAI segment. Core EBIDTA growth could be in line with revenue growth.

We expect a marginal decline in EBIDTA margin on the back of higher raw material cost and increase in other expenses. DRL is expected to report lower tax rate during Q3FY13E, PAT could witness higher growth than EBIDTA. Traction in the US, branded formulations and PSAI businesses could be the key growth drivers for FY13.

The company expanded its UK operations in the areas of development and manufacturing of new chemical entities in Q3.

Source : Equity Bulls

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