Dr. Reddy’s Lab Para-IV Upsides Priced-in - Maintain Hold :Emkay

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Dr. Reddy’s Lab

Para-IV Upsides Priced-in - Maintain Hold

HOLD

CMP: Rs 1,580                                        Target Price: Rs 1,604

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n     Q2FY12 revenues were in-line with our expectations. Revenues at Rs22.7bn (up 21%YoY), b) EBITDA at Rs4.8bn (up 18% YoY) and c) APAT at Rs3bn (up 4% YoY)

n     Revenues were driven by 42% growth in North America and 23% increase in Russia & CIS revenues

n     Growth in India business still remains a concern with a growth of 9% this quarter vs. 13-14% industry growth

n     Upsides from Para-IVs largely factored-in. Maintain Hold rating with a price target of Rs1604