Business Description:

Dr. Reddy’s Laboratories Ltd. is involved in the manufacturing and marketing of pharmaceutical products. Kallam Anjireddy founded the company on February 24, 1984. It is located in Hyderabad, India. It has three segments: Global Generics, Proprietary Products, Pharmaceutical Services, and Active Ingredients. The Pharmaceutical Services & Active Ingredients section is responsible for marketing and manufacturing active pharmaceutical intermediates and ingredients.

These are the main ingredients in finished pharmaceutical products. Global Generics is the manufacturing and marketing of over-the-counter and prescription pharmaceutical products that are ready for patient consumption. These products can be marketed under a brand or as generic dosages with therapeutic equivalent to branded formulations. The Proprietary Products section focuses on the development and research of new formulations. The operations of the subsidiary are included in the Others segment.

Key Financials:

Revenue (US$ Mn)

• Dr. Reddy’s Laboratories Ltd.’s annual revenue for 2021 was US$ 2,594 Mn, an 8.67% increase from 2020
• The annual revenue generated by Dr. Reddy’s Laboratories Ltd. in 2020 was US$ 2,387 Mn
• At a 4.94% increase, Dr. Reddy’s Laboratories Ltd.’s annual revenue of US$ 2,321 Mn was indexed in 2019
• Dr. Reddy’s Laboratories Ltd. generated total revenue of US$ 2,211 Mn in 2018

Operating Income(US$ Mn)

• US$ 361 Mn was Dr. Reddy’s Laboratories Ltd.’s operating income in 2021, a 46.15% increase from 2020 figures
• Dr. Reddy’s Laboratories Ltd. indexed a -43.29% decrease in operating incomes from 2019, amounting to US$ 247 Mn in 2020
• Dr. Reddy’s Laboratories Ltd. generated an operating income of US$ 436 Mn in 2019
• An operating income of US$ 282 Mn was indexed by Dr. Reddy’s Laboratories Ltd. in 2018

Net Income (US$ Mn)

• US$ 236 Mn was the net income generated by Dr. Reddy’s Laboratories Ltd. in 2021
• Dr. Reddy’s Laboratories Ltd.’s net income for 2020 was US$ 267 Mn, a 3.03% increase from 2019
• From 2018’s net incomes, Dr. Reddy’s Laboratories Ltd. registered a -4.07% decrease in 2019, amounting to US$ 259 Mn
• A net income of US$ 270 Mn was generated in 2018 by Dr. Reddy’s Laboratories Ltd.

Operating Margin %

• Dr. Reddy’s Laboratories Ltd.’s operating margin for 2021 was 14%, a 34.95% increase from 2020
• The operating margin generated by Dr. Reddy’s Laboratories Ltd. in 2020 was 10%
• At a 46.88% increase, Dr. Reddy’s Laboratories Ltd.’s operating margin of 19% was indexed in 2019
• Dr. Reddy’s Laboratories Ltd. generated an operating margin of 13% in 2018

Gross Margin %

• 54% was Dr. Reddy’s Laboratories Ltd.’s gross margin in 2021, a 0.93% increase from 2020 figures
• Dr. Reddy’s Laboratories Ltd. indexed a 0% decrease in gross margins from 2019, amounting to 54% in 2020
• Dr. Reddy’s Laboratories Ltd. generated a gross margin of 54% in 2019
• A gross margin of 54% was indexed by Dr. Reddy’s Laboratories Ltd. in 2018

SWOT Analysis

Strengths

Strong development capabilities enabling DRL to build a diverse and robust portfolio.

DRL has strong capabilities in areas ranging from synthetic organic chemistry, formulation development, biologics development, and small molecule-based drug discovery. Such expertise has enabled DRL to build an extensive product and robust pipeline portfolios. The company’s array of products includes active pharmaceutical ingredients (APIs), generics, biosimilars, and formulations. Its expertise in chemistry has resulted in several niche product opportunities such as fondaparinux and omeprazole.

Moreover, the company has a large generic pipeline of pending approvals. As of March 31, 2020, the company filed a cumulative total of 99 ANDAs pending approval at the US FDA. Further, in FY2020, the company filed 98 drug master files (DMFs). Thus, the strong development capabilities of DRL have enabled it to build a diverse and robust portfolio of products, which in turn, facilitates the company to expand its presence in various therapeutic and therapeutic areas.

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