The shares of Dr. Reddy’s Laboratories Ltd opened at the price of ₹4,543.30 on Friday, logging over a 7.60 percent downfall from two trading sessions from a price of ₹ 4,869 on Wednesday. One of the probable reasons for the low stock price movement is the company’s recent announcement of Q4 FY 22-23 earnings.
The company posted positive Q4 FY23 results on Wednesday but missed shy of the street’s estimated profit of ₹1,093.6 crore (As per Elara Securities Pvt Ltd).
As per Consolidated financials of the previous quarter, their operating revenues have declined from ₹ 6,789 crores in Q3 to ₹ 6,315 crores in Q4. Similarly, for YoY comparison, the revenues significantly increased from ₹ 21,545 crores during FY 21-22 to ₹ 24,669 crores in FY 22-23.
The net profit of the company has declined from ₹ 1,237 crores in Q3 to ₹ 952 crores in Q4, Similarly, for YoY comparison the net profit significantly increased from ₹ 2,122 crores during FY 21-22 to ₹ 4,470 crores in FY 22-23.
Dr. Reddy’s Laboratories Ltd is a leading India-based pharmaceutical company that offers a portfolio of products and services, including Active Pharmaceutical Ingredients, Custom Pharmaceutical services generics, biosimilars, and differentiated formulations, catering to both domestic and international clients.
The company declared a final dividend of ₹40 (800% of the face value of Rs 5 ) per equity share for FY23.
Over the previous fiscal year, the company introduced new products and benefitted from favourable currency moves, resulting in a 27% year-on-year (YoY) growth in US business to ₹ 2,532 crore, and an 11.6% YoY gain in European sales to 496 crores.
In India, the company released nine new items, which led to an increase in revenue growth of 32.5% year on year to ₹ 1283.4 crores And the company reported a Net cash surplus of ₹ 50.5 billion and a free cash flow of ₹ 40.1 billion as of March FY23.
The basic profitability ratios exhibiting operational efficiencies such as return on equity (ROE) and return on capital employed (ROCE) showed an upward trend in the past couple of financial years. ROE moved from 11.35 percent during FY 21-22 to 19.35 percent in FY 22-23 and ROCE, keeping the time frame the same, took a shift from 15.44 percent to 25.95 percent and The debt-to-equity ratio stands at 0.06.
On a last year-to-date basis, the stock gained 6.22 percent ranging from ₹ 4,238.35 to the current price level. In the previous three years, the stock has gained around 19.28 percent ranging from ₹ 3,735 to the current price level.
According to the latest data pertaining to the shareholding pattern, the promoters hold a 26.69 percent stake, and Foreign Institutional Investors (FIIs) hold a 27.25 percent stake in the company for FY 22-23.
Written by Omkar
