Dr. Reddy’s Labs Q2 Results Analyzed

Dr. Reddy’s Laboratories is expected to show moderate growth in its September 2025 (Q2FY26) results. This growth will be driven by strong performance in India and increased sales from new medicines. While sales in the United States might be a bit weaker because of existing medicines not selling as well as before, and prices going down, Dr. Reddy’s strong domestic business and smart purchases will help balance things out. Because of increasing costs and prices, the company’s profits might not grow as quickly as sales do.

Key Points

• Expected 5.5% Y-o-Y net profit increase (₹1,479 crore).
• Revenue expected to rise 7.7% to ₹8,637 crore.
• US sales down 6% Q-o-Q, impacting Revlimid sales.
• India business growth projected at 8% Y-o-Y.
• Ebitda expected to remain flat at ₹2,238 crore.
• Acquisitions and new drug launches supporting growth.

Analysts predict that Dr. Reddy’s will likely see a 5.5% increase in its profits, with revenues reaching approximately ₹8,637 crore. Despite these projections, challenges remain, especially in the US market where Revlimid sales are declining, and costs are rising.

The company’s strength lies in its domestic business, which is predicted to grow by 8% thanks to changes in taxes. Also, smart acquisitions and the launch of new medicines will contribute to this growth. However, the US market is a concern due to falling sales of Revlimid and increasing pressure on prices.

Brokerage reports indicate that Dr. Reddy’s Ebitda (earnings before interest, tax, depreciation, and amortization) is expected to remain stable at approximately ₹2,238 crore. The company’s acquisitions, including the purchase of the STUGERON brand, and the launch of Tegoprazan will also help boost sales.

HDFC Securities expects the US business to decline by 6% due to lower Revlimid sales. Systematix Institutional Equities projects 9% Y-o-Y revenue growth, primarily driven by strong India branded formulations. ICICI Securities highlights the importance of USFDA inspections and new drug approvals as key monitorables.

Ultimately, Dr. Reddy’s strategic investments and domestic strength offer a promising outlook despite ongoing market pressures.