Disclosure under Regulation 30 of SEBI (LODR) Regulations, 2015
Awaiting price reaction for this filing.
Dr. Reddy's Laboratories has received an order dated 30th May 2025 from the Income Tax Authority in Hyderabad under Section 148A(3) of the Income Tax Act, directing reassessment of income for Assessment Year 2020-21 (FY 2019-20). The matter relates to the merger of Dr. Reddy's Holding Limited (DRHL) into the company, which was approved by NCLT Hyderabad on 5th April 2022. A proposed tax demand of around Rs. 2,395.82 crore has been quantified in the earlier notice dated 4th April 2025. The company believes there is no escapement of tax from the merger, says the scheme complied with all legal and tax requirements, and is reviewing the order to take appropriate action. The company has also noted that promoters will indemnify the company against any liability arising from this amalgamation.
This is a significant potential tax exposure of nearly Rs. 2,396 crore, but the company maintains there is no material impact at this stage as it contests the order. Shareholders should watch for further developments, as an adverse ruling could materially affect financials, though promoter indemnification provides some cushion.