Audited Financial Results for the year ended March 31, 2026
DRREDDY · price
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Dr. Reddy's reported FY26 consolidated revenue of ₹335.9 billion, up 3.2% YoY, but profit after tax fell 24% to ₹42.9 billion due to multiple one-time impacts. Q4FY26 was particularly weak with revenue down 11.6% YoY to ₹75.2 billion and PAT plummeting 86% to ₹2.2 billion. Key headwinds include a ₹4.5 billion Shelf Stock Adjustment for Lenalidomide, ₹2.3 billion in impairments from discontinued CAR-T programs and Eftilagimod Alfa, ₹1.8 billion in VAT provisions, and ₹1.2 billion for new Labour Code compliance. North America revenue declined 22% YoY due to lower Lenalidomide volumes. EBITDA margin compressed from 28.3% to 22.8% for the year. The company changed its statutory auditors to Deloitte Haskins & Sells and recommended a dividend of ₹8 per share. Excluding one-offs, underlying performance remained resilient in emerging markets (up 23%) and India (up 16%).
The stock may face short-term pressure given significant profit decline and margin compression, though the company maintains positive cash generation and the dividend signals confidence. Long-term investors should monitor recovery in North America generics and successful cost optimization initiatives.