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Fri, 23 Oct 2026
BreakingEarnings

Dr. Reddy's Q2 FY27 attributable profit falls 36% to Rs 9.25bn; revenue down 2%

Global Generics revenues from North America fell 23% to Rs 24,890m while India rose 17% and Emerging Markets 24%. Gross margin narrowed to 52.1% from 54.7%.

By AI markets desk·Sources: Dr. Reddy's Laboratories, quarterly report for the quarter ended September 30, 2026 (Form 6-K); SEC EDGAR company submissions data, Dr. Reddy's Laboratories (ticker)·Published ·AI-generated·2 min read
Key facts
  • Profit after tax attributable to equity holders of the parent · Q2 FY27 (quarter ended 30 September 2026)9,250 Rs m -36% from Rs 14,372m a year earlier
  • Revenues · Q2 FY2786,708 Rs m -2% from Rs 88,051m a year earlier
  • Gross profit · Q2 FY2745,204 Rs m -6% year on year
  • Global Generics revenues from North America · Q2 FY2724,890 Rs m -23% year on year
  • Diluted earnings per share · Q2 FY2711.10 Rs from Rs 17.25 a year earlier
Q2 FY27 vs Q2 FY26 (IFRS)
ItemsThree months to 30 September 2026Three months to 30 September 2025Change
Revenues86,708 Rs m88,051 Rs m−1.5%
Gross profit45,204 Rs m48,140 Rs m−6.1%
Results from operating activities12,683 Rs m17,513 Rs m−27.6%
Profit attributable to equity holders of the parent9,250 Rs m14,372 Rs m−35.6%

Source: Dr. Reddy's Laboratories quarterly report, quarter ended 30 September 2026 (Form 6-K), 23 October 2026, Q2 FY27.

Dr. Reddy's Laboratories' revenues fell 2% in the three months ended 30 September 2026, the second quarter of its fiscal year to March 2027, while profit after tax attributable to equity holders of the parent company fell 36% to Rs 9,250 million from Rs 14,372 million, according to the company's Form 6-K furnished to the SEC on 23 October 2026. Results from operating activities fell to Rs 12,683 million from Rs 17,513 million. Diluted earnings per share were Rs 11.10, against Rs 17.25 a year earlier.

Margins, % of revenues
  • Gross margin52.1%−2.6 pp
  • Global Generics gross margin (% of segment revenues)56.2%−2.9 pp
  • PSAI gross margin (% of segment revenues)11.8%−6.2 pp
  • Profit attributable to equity holders10.7%−5.6 pp

Q2 FY27Q2 FY26

Source: Dr. Reddy's Laboratories quarterly report, quarter ended 30 September 2026 (Form 6-K), 23 October 2026, Q2 FY27.

The company attributed the lower Global Generics gross margin mainly to price erosion in some existing products and an unfavourable product mix, and the drop in the Pharmaceutical Services and Active Ingredients (PSAI) margin mainly to higher manufacturing overheads. Selling, general and administrative expenses rose 6% to Rs 28,075 million, or 32.4% of revenues against 30.0% a year earlier, which the filing put down largely to higher personnel and freight costs. Research and development spending fell 16% to Rs 5,235 million. Net finance expense was Rs 329 million, against net finance income of Rs 774 million a year earlier, and the effective tax rate rose to 25.6% from 22.2%.

Breakdown

Revenues by segment, Q2 FY27

  • Global Generics77,927 Rs m90%
  • PSAI8,310 Rs m10%
  • Others471 Rs m1%

Total: 86,708 Rs m

Source: Dr. Reddy's Laboratories quarterly report, quarter ended 30 September 2026 (Form 6-K), 23 October 2026, Three months to 30 September 2026.

Within Global Generics, which slipped 1%, Emerging Markets revenues rose 24% to Rs 20,595 million and India rose 17% to Rs 18,508 million. The filing puts three declines mainly down to some existing products: lower net sales prices and volumes in North America, where revenues fell to Rs 24,890 million from Rs 32,408 million; lower net sales prices in Europe, where revenues rose 1% in rupee terms to Rs 13,935 million but decreased excluding exchange-rate effects; and lower sales volumes in PSAI, where revenues fell 12%.