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Read more about Dr Reddy\'s Q3 profit down 29% at Rs 3.3 bn on higher price erosion on Business Standard. BS ReporterHyderabad, 25 January: Indian pharmaceutical major Dr Reddy\'s Laboratories Limited has reported a 29 percent decline in consolidated net profit at Rs 3.34 billion for the quarter ended December 2017 on the back of higher price erosion,

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dr reddy s q3 profit down

Dr Reddy's Q3 profit down 29% at Rs 3.3 bn on

higher price erosion

Indian pharmaceutical major Dr. Reddy's Laboratories Limited has reported a 29

per cent decline in consolidated net profit at Rs 3.34 billion for the quarter ended

December 2017, compared with Rs 4.70 billion a year earlier, on the back of

higher price erosion, increased competition and the impact of adverse foreign

exchange in the US and European markets.

However, the company was able to post a 3 per cent increase in consolidated

revenues at Rs 38.06 billion during the third quarter under review as compared

with Rs 37.07 billion in the corresponding quarter previous year.

"We had a satisfactory third quarter performance with all our key markets

performing well. We recorded sequential revenue growth of 7 per cent despite

continuing challenges such as price erosion in the USA.

Our first-cycle NDA approval of Impoyz is a significant milestone in the

commercialisation of four proprietary products pipeline. We will continue our

focus on operational excellence and controlling of SG&A (selling, general and

administrative costs across the organisation

administrative) costs across the organisation," Dr Reddy's CEO and co-chairman G

V Prasad said.

The share of global generics in the company's overall revenues declined to 79 per

cent in the quarter under review from 83 per cent, while its revenue contribution

fell 2 per cent to Rs 30.1 billion as revenues marginally decreased across all the

markets except India.

Revenues from the Indian market, which is the second largest grosser for the

company in global generics segment during the quarter, registered a 3 per cent

increase at Rs 6.12 billion during the quarter.

On a sequential basis, global generics grew 5 per cent as compared to Rs 28.62

billion in the quarter ended September, 2017.

On the other hand, pharmaceutical services and active ingredients (PSAI) segment

has registered a one per cent growth at Rs 5.44 billion in the third quarter as

revenues from India and the rest of the world (other than North America and

Europe) increased substantially. The revenue from proprietary products rose to

2.52 billion during the quarter from Rs 1.19 billion in the year-ago period.

The gross profit margin declined by 280 basis points over that of previous year

primarily on account of higher price erosions, increased competitive intensity in

some of the key molecules in the US, the company said.

SG&A expenses at Rs 12 billion was an increase of 6 percent over that of the

previous year. During the quarter, a settlement agreement was entered into with

the US Department of Justice on litigation involving packaging against a payout of

Rs 319 million.

The company has reported a finance income of 0.85 billion for the quarter as

compared to Rs 44 million in the corresponding previous quarter.

Article By - Business Standard