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6-K 1 drr0529_6k.htm FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

October 2023

Commission File Number 1-15182

DR. REDDY’S LABORATORIES LIMITED

(Translation of registrant’s name into English)

8-2-337, Road No. 3, Banjara Hills

Hyderabad, Telangana 500 034, India

+91-40-49002900

______________

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ______

Yes ¨ No x

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ______

Yes ¨ No x

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ¨ No x

If “Yes” is marked, indicate below the file number assigned to registrant in connection with Rule 12g3-2(b): 82-________.

DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

We hereby furnish the United States Securities and Exchange Commission with copies of the following information about our public disclosures regarding our results of operations and financial condition for the quarter and half year ended September 30, 2023.

On October 27, 2023, we announced our results of operations for the quarter and half year ended September 30, 2023. We issued a press release announcing our results under International Financial Reporting Standards (“IFRS”), IFRS Unaudited Consolidated Financial Results, Ind AS Unaudited Consolidated Financial Results with Limited Review report and Ind AS Unaudited Standalone Financial Results with Limited Review report for the quarter and half year ended September 30, 2023, a copy of which is attached to this Form 6-K as Exhibit 99.1 , 99.2 , 99.3 and 99.4 respectively.

We have also made available to the public on our web site, www.drreddys.com, the following: IFRS Unaudited Consolidated Financial Results, Ind AS Unaudited Consolidated Financial Results and Ind AS Unaudited Standalone Financial Results for the quarter and half year ended September 30, 2023.

EXHIBITS

Exhibit Number		Description of Exhibits
99.1		Press Release, “Dr. Reddy’s Q2 FY2024 Financial Results”, October 27, 2023.
99.2		IFRS Unaudited Consolidated Financial Results for the quarter and half year ended September 30, 2023.
99.3		Ind AS Unaudited Consolidated Financial Results for the quarter and half year ended September 30, 2023.
99.4		Ind AS Unaudited Standalone Financial Results for the quarter and half year ended September 30, 2023.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	DR. REDDY’S LABORATORIES LIMITED (Registrant)

Date: October 27, 2023	By:	/s/ K Randhir Singh
		Name:	K Randhir Singh
		Title:	Company Secretary & Compliance Officer

EX-99.1 2 drr0529_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

CONTACT

DR. REDDY'S LABORATORIES LTD.

INVESTOR RELATIONS

MEDIA RELATIONS

8-2-337, Road No. 3, Banjara Hills,
Hyderabad - 500034. Telangana, India.

RICHA PERIWAL

richaperiwal@drreddys.com

USHA IYER

ushaiyer@drreddys.com

Dr. Reddy’s Q2 FY24 Financial Results

Hyderabad, India, Oct 27, 2023: Dr. Reddy’s Laboratories Ltd. (BSE: 500124 | NSE: DRREDDY | NYSE: RDY | NSEIFSC: DRREDDY) today announced its consolidated financial results for the quarter ended Sep 30, 2023. The information mentioned in this release is based on consolidated financial statements under International Financial Reporting Standards (IFRS).

Revenues		Rs. 68,802 Mn [Up: 9% YoY; Up: 2% QoQ]

Gross Margin		58.7% [Q2 FY23: 59.1%; Q1 FY24: 58.7%]

SG&A Expenses		Rs. 18,795 Mn [Up: 13% YoY; 6% QoQ]

R&D Expenses		Rs. 5,447 Mn [7.9% of Revenues]

EBITDA		Rs. 21,813 Mn [31.7% of Revenues]

Profit before Tax		Rs. 19,134 Mn [Up: 19% YoY; Up: 4% QoQ]

Profit after Tax		Rs. 14,800 Mn [Up: 33% YoY; Up: 6% QoQ]

Commenting on the results, Co-Chairman & MD, G V Prasad said: “We delivered another quarter of strong results with highest ever sales and profits, driven by market share gains & momentum in our US generics business and robust growth in Europe. We are continuing to strengthen our pipeline both organically and through business development to drive growth and create differentiation.”

All amounts in millions, except EPS

All US dollar amounts based on convenience translation rate of 1 USD = Rs. 83.08

Dr. Reddy’s Laboratories Limited and Subsidiaries

Consolidated Income Statement

	Q2 FY24						Q2 FY23						YoY			Q1 FY24						QoQ
Particulars	($)			(Rs.)			($)			(Rs.)			Gr %			($)			(Rs.)			Gr %
Revenues		828			68,802			759			63,057			9			811			67,384			2
Cost of Revenues		342			28,434			311			25,810			10			335			27,831			2
Gross Profit		486			40,368			448			37,247			8			476			39,553			2
Operating Expenses
Selling, General & Administrative expenses		226			18,795			199			16,560			13			213			17,702			6.2
Research and Development expenses		66			5,447			59			4,869			12			60			4,984			9
Impairment of non-current assets		1			55			0			25			120			0			11			400
Other operating (income)/expense		(22	)		(1796	)		(4	)		(334	)		438			(9	)		(780	)		130
Results from operating activities		215			17,867			194			16,127			11			212			17,636			1
Net finance (income)/expense		(15	)		(1225	)		2			156			(885	)		(9	)		(784	)		56
Share of profit of equity accounted investees		(1	)		(42	)		(2	)		(140	)		(70	)		(1	)		(43	)		(2	)
Profit before income tax		230			19,134			194			16,111			19			222			18,463			4
Income tax expense		52			4,334			60			4983			(13	)		53			4,438			(2	)
Profit for the period		178			14,800			134			11,128			33			169			14,025			6

Diluted Earnings Per Share (EPS)		1.07			88.78			0.81			66.89			33			1.01			84.22			5

As % to revenues	Q2 FY24		Q2 FY23		Q1 FY24
Gross Profit		58.7		59.1		58.7
SG&A		27.3		26.3		26.3
R&D		7.9		7.7		7.4
EBITDA		31.7		30.6		31.7
PBT		27.8		25.5		27.4
PAT		21.5		17.6		20.8

EBITDA Computation

	Q2 FY24						Q2 FY23				Q1 FY24
Particulars	($)			(Rs.)			($)		(Rs.)		($)			(Rs.)
Profit before Income Tax		230			19,134			194		16,111		222			18,463
Interest (income) / expense - Net*		(14	)		(1,166	)		1		61		(8	)		(685	)
Depreciation		29			2,437			25		2,107		27			2,281
Amortization		16			1,353			12		1,018		16			1,302
Impairment		0			55			0		25		0			11
EBITDA		262			21,813			233		19,322		257			21,372

* Includes income from Investments

All amounts in millions, except EPS

All US dollar amounts based on convenience translation rate of 1 USD = Rs. 83.08

Key Balance Sheet Items

	As on 30th Sep 2023				As on 30th Jun 2023				As on 30th Sep 2022
Particulars	($)		(Rs.)		($)		(Rs.)		($)		(Rs.)
Cash and cash equivalents and other investments		840		69,784		736		61,162		353		29,306
Trade receivables		839		69,722		928		77,095		927		76,987
Inventories		681		56,592		631		52,398		590		49,042
Property, plant, and equipment		848		70,478		809		67,207		768		63,817
Goodwill and Other Intangible assets		497		41,278		509		42,306		434		36,084
Loans and borrowings (current & non-current)		159		13,230		151		12,520		208		17,289
Trade payables		367		30,485		333		27,682		274		22,778
Equity		3,046		2,53,086		2,952		2,45,259		2,482		2,06,225

Revenue Mix by Segment

	Q2 FY24		Q2 FY23		YoY			Q1 FY24		QoQ
Segment	(Rs.)		(Rs.)		Gr %			(Rs.)		Gr %
Global Generics		61,084		55,946		9			60,083		2
North America		31,700		28,001		13			31,978		(1	)
Europe		5,286		4,199		26			5,071		4
India		11,860		11,500		3			11,482		3
Emerging Markets		12,163		12,246		(1	)		11,552		5
Pharmaceutical Services and Active Ingredients (PSAI)		7,034		6,434		9			6,709		5
Others		684		677		1			592		15
Total		68,802		63,057		9			67,384		2

Revenue Analysis [Q2 FY24]

Global Generics (GG)

Q2 FY24 revenue at Rs. 61.1 billion, YoY growth of 9% and QoQ growth of 2%. This growth was primarily driven by North America and Europe.

North America

Q2 FY24 revenue at Rs. 31.7 billion, YoY growth of 13% and QoQ decline of 1%. The growth was on account of growing momentum in our core portfolio, Mayne integration, favorable move from foreign exchange which was partly offset by price erosion.

During the quarter, we launched 4 new products in US.

During the quarter, we filed 2 new Abbreviated New Drug Applications (ANDAs) with the US Food and Drug Administration (USFDA). As of 30th Sep 2023, cumulatively 79 generic filings are pending for approval with the USFDA (75 ANDAs and 4 NDAs under 505(b)(2) route). Out of the pending 79 ANDAs, 41 are Para IVs, and we believe 20 have ‘First to File’ status.

Europe

Q2 FY24 revenue at Rs. 5.3 billion, YoY growth of 26% and QoQ growth of 4%. The growth was driven by leveraging existing portfolio, contribution from new products and favorable forex which was partly offset by price erosion.

India

Q2 FY24 revenue at Rs. 11.9 billion, YoY growth of 3% and QoQ increase of 3%. This growth was largely driven by pricing, new launches and partly offset by NLEM impact and muted demand due to weak acute season. Excluding NLEM, operational sales grew in mid-single digit.

Emerging Markets

Q2 FY24 revenue from Emerging Markets at Rs. 12.2 billion, YoY decline of 1% and QoQ growth of 5%.

Revenue from Russia for the quarter at Rs. 5.8 billion, YoY decline of 3% and QoQ growth of 3%. YoY decline was majorly due to currency devaluation, excluding which YoY growth of 4% and QoQ growth of 9%. The increase was mainly driven by favorable pricing.

Revenue from other CIS countries and Romania for the year at Rs. 2.2 billion, YoY growth of 1% and QoQ growth of 12%. YoY growth, primarily on account of price increases on certain products, favorable move from foreign exchange which was partly offset by decline in base business volumes. QoQ growth was primarily driven by base business demand, partly offset by pricing pressure.

Revenue from Rest of World (RoW) territories for the year at Rs. 4.2 billion, YoY growth of 1% and QoQ growth of 6%. YoY growth, led by new product launches, which was partly offset by pricing pressure and lower base business. QoQ growth was mainly driven by new product launches and increase in demand of existing products and was partly offset by price erosion.

Pharmaceutical Services and Active Ingredients (PSAI)

Q2 FY24 revenue at Rs. 7.0 billion, with a growth of 9% YoY and 5% QoQ. YoY growth was mainly driven by new product launches, favorable move from foreign exchange partly offset with price erosion. QoQ growth was mainly driven by new product launches.

Income Statement Highlights:

Q2 FY24 gross margin at 58.7% (GG: 63.6%, PSAI: 17.8%). Gross margin decreased by ~40 bps YoY and was in line with preceding quarter. The decline in gross margin was primarily driven by marginal adverse price variance in certain products and mix change offset with favorable forex benefit

Selling, general & administrative (SG&A) expenses for Q2 FY24 at Rs. 18.8 billion, YoY increase of 13% and by 6% QoQ. The YoY SG&A spend increase is largely on account of investment in sales & marketing, digitalization, and other business initiatives.

Research & development (R&D) expenses in Q2 FY24 at Rs. 5.4 billion. As % to Revenues – Q2FY24: 7.9% | Q1FY24: 7.4% | Q2 FY23: 7.7%. R&D investments are driven by ongoing clinical trials on differentiated assets, as well as other developmental efforts to build a healthy pipeline of new products across our markets for both small molecules and biosimilars.

Other operating income for Q2 FY24 at Rs. 1.8 billion compared to Rs. 0.3 billion in Q2 FY23. Other operating income included the one-off income benefit of ~ Rs. 0.98 billion pursuant to settlement of product related litigation in the United Kingdom.

Net Finance income for Q2 FY24 at Rs.1.2 billion compared to net finance expense of Rs. 0.2 billion in Q2 FY23. The higher income was primarily on account of profit on sale of units of mutual funds and other investments.

Profit before Tax for Q2 FY24 at Rs. 19.1 billion, YoY growth of 19%. QoQ growth of 4%

Profit after Tax for Q2 FY24 at Rs. 14.8 billion. The effective tax rate for the quarter has been 22.7% as compared to 30.9% in Q2 FY23. The lower tax was primarily due to decrease in the corporate income tax rate in India.

Diluted earnings per share for Q2 FY24 is Rs. 88.78

Other Highlights:

EBITDA for Q2 FY24 at Rs. 21.8 billion and the EBITDA margin is 31.7%.

Capital expenditure for Q2 FY24 at Rs. 3.2 billion.

Free cash-flow for Q2 FY24 at Rs. 14.5 billion (before acquisition payout).

Net cash surplus for the company at Rs. 59.1 billion as on Sep 30, 2023.

All amounts in millions, except EPS

About key metrics and non-GAAP Financial Measures

This press release contains non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical performance, financial position or cash flows that are adjusted to exclude or include amounts from the most directly comparable financial measure calculated and presented in accordance with IFRS.

The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with IFRS. Our non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. These measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.

We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business.

For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please refer to "Reconciliation of GAAP to Non-GAAP Results" table in this press release.

All amounts in millions, except EPS

Reconciliation of GAAP measures to non-GAAP measures

Free Cash Flow

	Three months Ended Sep 30, 2023
Net cash generated from operating activities		24,030
Less:
Taxes		(6102	)
Investments in PPE and Intangibles		(3450	)
Free Cash Flow before acquisition		14,478
Less:
Acquisitions related pay-out		-
Free Cash Flow		14,478

Operating working capital

	Quarter Ended Sep 30, 2023
Inventories		56,592
Trade Receivables		69,722
Less:
Trade Payables		(30,485	)
Operating Working Capital		95,829

Net cash surplus

	Quarter Ended Sep 30, 2023
Cash and cash equivalents		13,539
Investments		56,245
Short-term borrowings		(5,847	)
Long-term borrowings, non-current		(6043	)
Less:
Restricted cash balance – Unclaimed dividend		89
Lease liabilities (included in Long-term borrowings, non-current)		(2243	)
Equity Investments (included in Investments)		988
Net Cash Surplus		59,060

All amounts in millions, except EPS

Computation of Return on Capital Employed

	Year Ended Sep 30, 2023
Profit before tax		19,134
Less:
Interest and Investment Income (Excluding forex gain/loss)		1,166
Earnings Before Interest and taxes [A]		17,968

Average Capital Employed [B]		1,83,550

Return on Capital Employed (A/B) (Ratio)		38.9	%

Computation of capital employed.

	Year Ended Sep 30, 2023		Year Ended Mar 31, 2023
Property Plant and Equipment		70,478		66,462
Intangibles		37,055		30,849
Goodwill		4,223		4,245
Investment in equity accounted associates		4,069		4,702
Other Current Assets		22,423		20,069
Other investments		1,855		660
Other non-current assets		812		800
Inventories		56,592		48,670
Trade Receivables		69,722		72,485
Derivative Financial Instruments		189		1,095
Less:
Other Liabilities		40,297		42,320
Provisions		5,298		5,513
Trade payables		30,485		26,444
Operating Capital Employed		1,91,341		1,75,760
Average Capital Employed		1,83,550

Computation of EBITDA

Refer page no. 2 for EBITDA computations.

Earnings Call Details (07:30 pm IST, 10:00 am EDT, Oct 27, 2023)

The management of the Company will host an Earnings call to discuss the Company’s financial performance and answer any questions from the participants.

Conference Joining Information

Option 1: Express Join with DiamondPass™

Pre-register with the below link and join without waiting for the operator.

https://services.choruscall.in/DiamondPassRegistration/register?confirmationNumber=7967211&linkSecurityString=2c6ede051b

Option 2: Join through below Dial-In Numbers

Universal Access Number:

+91 22 6280 1219

+91 22 7115 8120

International Toll-Free Number:

USA: 1 866 746 2133

UK: 0 808 101 1573

Singapore: 800 101 2045

Hong Kong: 800 964 448

No password/pin number is necessary to dial in to any of the above numbers. The operator will provide instructions on asking questions before and during the call.

Play Back: The play back will be available after the earnings call, till Nov 3rd, 2023. For play back dial in phone No: +91 22 7194 5757, and Playback Code is 02796.

Transcript: Transcript of the Earnings call will be available on the Company’s website: www.drreddys.com

About Dr. Reddy’s: Dr. Reddy’s Laboratories Ltd. (BSE: 500124, NSE: DRREDDY, NYSE: RDY, NSEIFSC: DRREDDY) is a global pharmaceutical company headquartered in Hyderabad, India. Established in 1984, we are committed to providing access to affordable and innovative medicines. Driven by our purpose of ‘Good Health Can’t Wait’, we offer a portfolio of products and services including APIs, generics, branded generics, biosimilars and OTC. Our major therapeutic areas of focus are gastrointestinal, cardiovascular, diabetology, oncology, pain management and dermatology. Our major markets include – USA, India, Russia & CIS countries, China, Brazil, and Europe. As a company with a history of deep science that has led to several industry firsts, we continue to plan and invest in businesses of the future. As an early adopter of sustainability and ESG actions, we released our first Sustainability Report in 2004. Our current ESG goals aim to set the bar high in environmental stewardship; access and affordability for patients; diversity; and governance. For more information, log on to: www.drreddys.com.

Disclaimer: This press release may include statements of future expectations and other forward-looking statements that are based on the management’s current views and assumptions and involve known or unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. In addition to statements which are forward-looking by reason of context, the words "may", "will", "should", "expects", "plans", "intends", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" and similar expressions identify forward-looking statements. Actual results, performance or events may differ materially from those in such statements due to without limitation, (i) general economic conditions such as performance of financial markets, credit defaults , currency exchange rates , interest rates , persistency levels and frequency / severity of insured loss events (ii) mortality and morbidity levels and trends, (iii) changing levels of competition and general competitive factors, (iv) changes in laws and regulations and in the policies of central banks and/or governments, (v) the impact of acquisitions or reorganization , including related integration issues, and (vi) the susceptibility of our industry and the markets addressed by our, and our customers’, products and services to economic downturns as a result of natural disasters, epidemics, pandemics or other widespread illness, including coronavirus (or COVID-19), and (vii) other risks and uncertainties identified in our public filings with the Securities and Exchange Commission, including those listed under the "Risk Factors" and "Forward-Looking Statements" sections of our Annual Report on Form 20-F for the year ended March 31, 2022. The company assumes no obligation to update any information contained herein.” The company assumes no obligation to update any information contained herein.

EX-99.2 3 drr0529_ex99-2.htm EXHIBIT 99.2

Exhibit 99.2

Dr. Reddys Laboratories Ltd.

8-2-337, Road No. 3, Banjara Hills,

Hyderabad - 500 034, Telangana,
India.

CIN : L85195TG1984PLC004507

Tel : +91 40 4900 2900

Fax : +91 40 4900 2999

Email : mail@drreddys.com

www.drreddys.com

DR. REDDY'S LABORATORIES LIMITED

Unaudited consolidated financial results of Dr. Reddy's Laboratories Limited and its subsidiaries for the quarter and half year ended 30 September 2023 prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB)

		All amounts in Indian Rupees millions
			Quarter ended									Half year ended						Year ended
Sl. No.		Particulars	30.09.2023			30.06.2023			30.09.2022			30.09.2023			30.09.2022			31.03.2023
			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Audited)
	1	Revenues		68,802			67,384			63,057			136,186			115,211			245,879
	2	Cost of revenues		28,434			27,831			25,810			56,265			51,958			106,536
	3	Gross profit (1 - 2)		40,368			39,553			37,247			79,921			63,253			139,343
	4	Selling, general and administrative expenses		18,795			17,702			16,560			36,497			32,053			68,026
	5	Research and development expenses		5,447			4,984			4,869			10,431			9,194			19,381
	6	Impairment of non-current assets		55			11			25			66			25			699
	7	Other income, net		(1,796	)		(780	)		(334	)		(2,576	)		(6,358	)		(5,907	)
		Total operating expenses		22,501			21,917			21,120			44,418			34,914			82,199
	8	Results from operating activities [(3) - (4 + 5 + 6 + 7)]		17,867			17,636			16,127			35,503			28,339			57,144
		Finance income		1,578			1,155			153			2,733			2,849			4,281
		Finance expense		(353	)		(371	)		(309	)		(724	)		(656	)		(1,428	)
	9	Finance income/(expense), net		1,225			784			(156	)		2,009			2,193			2,853
	10	Share of profit of equity accounted investees, net of tax		42			43			140			85			234			370
	11	Profit before tax (8 + 9 + 10)		19,134			18,463			16,111			37,597			30,766			60,367
	12	Tax expense, net		4,334			4,438			4,983			8,772			7,762			15,300
	13	Profit for the period/year (11 -12)		14,800			14,025			11,128			28,825			23,004			45,067
	14	Earnings per share:
		Basic earnings per share of Rs.5/- each		88.96			84.40			67.04			173.36			138.59			271.43
		Diluted earnings per share of Rs.5/- each		88.78			84.22			66.89			173.00			138.30			270.85
				(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)

Segment information							All amounts in Indian Rupees millions
			Quarter ended						Half year ended				Year ended
Sl. No.		Particulars	30.09.2023		30.06.2023		30.09.2022		30.09.2023		30.09.2022		31.03.2023
				(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Audited)
		Segment wise revenue and results:
	1	Segment revenue:
		a) Pharmaceutical Services and Active Ingredients		9,446		9,218		8,110		18,664		16,243		36,646
		b) Global Generics		61,084		60,083		55,946		121,167		100,270		213,768
		c) Others		684		592		677		1,276		1,417		3,042
		Total		71,214		69,893		64,733		141,107		117,930		253,456
		Less: Inter-segment revenues		2,412		2,509		1,676		4,921		2,719		7,577
		Net revenues		68,802		67,384		63,057		136,186		115,211		245,879

	2	Segment results:
		Gross profit from each segment
		a) Pharmaceutical Services and Active Ingredients		1,254		1,009		233		2,263		1,343		4,715
		b) Global Generics		38,873		38,387		36,567		77,260		60,966		132,719
		c) Others		241		157		447		398		944		1,909
		Total		40,368		39,553		37,247		79,921		63,253		139,343
		Less: Selling and other un-allocable expenditure, net of other income		21,234		21,090		21,136		42,324		32,487		78,976
		Total profit before tax		19,134		18,463		16,111		37,597		30,766		60,367

Global Generics segment includes operations of Biologics business. Inter-segment revenues represents sales from Pharmaceutical Services and Active Ingredients to Global Generics and Others at cost.

Notes:

The above statement of unaudited consolidated financial results of Dr.Reddy's Laboratories Limited ("the Company"), which have been prepared in accordance with recognition and measurement principles of IAS 34 as issued by the International Accounting Standards Board (IASB) and were reviewed and recommended by Audit Committee and approved by the Board of Directors at their meetings held on 27 October 2023. The Auditors have carried out a limited review on the unaudited consolidated financial results and issued an unmodified report thereon.

“Other income, net” for the quarter ended 30 September 2023 includes Rs.984 million recognized pursuant to settlement of product related litigation by the Company and its affiliates in the United Kingdom. This transaction pertain to Company’s Global Generics segment.

“Other income, net” for the quarter ended 30 June 2023 includes Rs.540 million recognised pursuant to settlement agreement with Janssen Group, in settlement of the claim brought in the Federal Court of Canada by the Company and its affiliates for damages under section 8 of the Canadian Patented Medicines (Notice of Compliance) Regulations in regard to the Company’s ANDS for a generic version of Zytiga®(Abiraterone). This transaction pertain to Company’s Global Generics segment.

"Other income, net" for the half year ended 30 September 2022 includes an amount of Rs.5,638 million (U.S.$71.39 million discounted to present value) towards the settlement of an ongoing litigation relating to launch of a product with Indivior Inc., Indivior UK Limited and Aquestive Therapeutics, Inc.

Included in “Other income, net” for the year ended 31 March 2023, is an amount of Rs.991 million representing the Loss on sale of Assets, pursuant to agreement dated 16 December 2022 with Delpharm Development Leiden B.V (Delpharm) for transfer of its certain assets, liabilities and employees at its site at Leiden, Netherlands.This transaction pertains to Company’s Global Generics segment.

Revenues for the year ended 31 March 2023 includes :

a) Rs.2,640 million from sale of certain non-core dermatology brands to Eris Lifesciences Limited;
b) Rs.1,399 million from sale of brands Styptovit-E, Finast, Finast-T and Dynapres to Torrent Pharmaceuticals Limited;
c) Rs.902 million from sale of brands Z&D, Pedicloryl, Pecef and Ezinapi to J B Chemicals and Pharmaceuticals Limited.
The amounts recognised above are adjusted for expected sales returns. These transactions pertain to Company’s Global Generics segment.

During the year ended 31 March 2023, Company considered impairment of Rs.540 million towards:

a. The Company assessed performance of business acquired from Nimbus Health GmbH against the initial estimates and performance of the products. Basis the assessment, the Company has recorded an impairment charge of the carrying values amounting to Rs.375 million (Goodwill - Rs.272 million and Other intangibles - Rs.103 million). The said impairment charge pertains to the Company’s Global Generics segment.
b. Consequent to adverse market conditions with respect to certain of the Company’s products related intangibles forming part of the company’s Global Generics and Pharmaceutical Services and Active Ingredients segments, the Company assessed the recoverable amount of these products and recognised an amount of Rs. 165 million as impairment charge during the year ended 31 March 2023.

The Company has considered the impact of recent tax regulations and developments, including updates to its estimate on the impact of adoption of the Taxation Laws (Amendment) Act 2019, in determining its “Tax expense, net” for the half year ended 30 September 2023 and year ended 31 March 2023.

During the half year and quarter ended 30 September 2023, an amount of Rs.2,274 million and Rs.1,598 million, respectively, representing government grants has been accounted as a reduction from cost of revenues.

During the quarter ended 30 September 2022, an amount of Rs.1,933 million representing government grants has been accounted as a reduction from cost of revenues.

11	Consolidated statements of financial position

	All amounts in Indian Rupees millions
	As at			As at
Particulars	30.09.2023			31.03.2023
	(Unaudited)			(Audited)
ASSETS
Current assets
Cash and cash equivalents		13,539			5,779
Other investments		54,390			56,018
Trade and other receivables		69,722			72,485
Inventories		56,592			48,670
Derivative financial instruments		731			1,232
Tax assets		298			2,687
Other current assets		22,423			20,069
Total current assets		217,695			206,940
Non-current assets
Property, plant and equipment		70,478			66,462
Goodwill		4,223			4,245
Other intangible assets		37,055			30,849
Investment in equity accounted investees		4,069			4,702
Other investments		1,855			660
Deferred tax assets		10,835			7,196
Other non-current assets		812			800
Total non-current assets		129,327			114,914
Total assets		347,022			321,854

LIABILITIES AND EQUITY
Current liabilities
Trade and other payables		30,485			26,444
Short-term borrowings		5,847			7,390
Long-term borrowings, current portion		1,336			4,804
Provisions		5,239			5,454
Tax liabilities		3,985			2,144
Derivative financial instruments		542			137
Bank overdraft		4			-
Other current liabilities		36,745			39,472
Total current liabilities		84,183			85,845
Non-current liabilities
Long-term borrowings		6,043			1,278
Deferred tax liabilities		102			833
Provisions		59			59
Other non-current liabilities		3,549			2,848
Total non-current liabilities		9,753			5,018
Total liabilities		93,936			90,863
Equity
Share capital		834			833
Treasury shares		(1,021	)		(1,269	)
Share premium		10,625			9,688
Share based payment reserve		1,442			1,652
Capital redemption reserve		173			173
Debenture redemption reserve		-			380
Special economic zone re-investment reserve		810			886
Retained earnings		238,226			215,593
Other components of equity		1,997			3,055
Total equity		253,086			230,991
Total liabilities and equity		347,022			321,854

The Company received an anonymous complaint in September 2020, alleging that healthcare professionals in Ukraine and potentially in other countries were provided with improper payments by or on behalf of the Company in violation of U.S. anti-corruption laws, specifically the U.S. Foreign Corrupt Practices Act. The Company disclosed the matter to the U.S. Department of Justice (“DOJ”), Securities and Exchange Commission (“SEC”) and Securities Exchange Board of India. The Company engaged a U.S. law firm to conduct the investigation at the instruction of a committee of the Company’s Board of Directors. On 06 July 2021 the Company received a subpoena from the SEC for the production of related documents, which were provided to the SEC.

The Company made presentations to the SEC and the DOJ in relation to the investigation with respect to certain countries during the previous fiscal years. The Company also made a presentation to the SEC and the DOJ in relation to its Global Compliance Framework, including the ongoing enhancement initiatives, during the year ended 31 March 2023. The Company is complying with its listing obligations as it relates to updating the regulatory agencies. While the findings from the aforesaid investigations could result in government or regulatory enforcement actions against the Company in the United States and/or foreign jurisdictions, which can lead to civil and criminal sanctions under relevant laws, the outcomes including liabilities are not reasonably ascertainable at this time.

13.

Consolidated statements of cash flows

	All amounts in Indian Rupees millions
	Half year ended
Particulars	30.09.2023			30.09.2022
	(Unaudited)			(Unaudited)
Cash flows from operating activities :
Profit for the period		28,825			23,004
Adjustments for:
Tax expense		8,772			7,762
Fair value changes and profit on sale of financial instruments measured at FVTPL**, net		(1,527	)		(78	)
Depreciation and amortization		7,358			6,176
Impairment of non-current assets		66			25
Allowance for credit losses (on trade receivables and other advances)		137			69
(Gain)/loss on sale or de-recognition of non-current assets, net		(445	)		68
Share of profit of equity accounted investees		(85	)		(234	)
Inventories write-down		1,418			2,732
Foreign exchange gain, net		(1,179	)		(345	)
Interest (income)/expense, net		(324	)		223
Equity settled share-based payment expense		211			263
Dividends income		-			-	*
Changes in operating assets and liabilities:
Trade and other receivables		2,689			(10,150	)
Inventories		(9,340	)		(890	)
Trade and other payables		4,568			(2,356	)
Other assets and other liabilities, net		(3,482	)		(5,693	)
Cash generated from operations		37,662			20,576
Income tax paid, net		(8,486	)		(4,640	)
Net cash generated from operating activities		29,176			15,936

Cash flows (used in)/from investing activities :
Expenditures on property, plant and equipment		(7,323	)		(5,816	)
Proceeds from sale of property, plant and equipment		487			48
Expenditures on other intangible assets		(8,787	)		(6,203	)
Proceeds from sale of other intangible assets		21			-
Purchase of other investments		(70,008	)		(47,008	)
Proceeds from sale of other investments		71,815			59,395
Dividend received from equity accounted investees		445			-
Interest and dividend received		597			394
Net cash (used in)/from in investing activities		(12,753	)		810

Cash flows used in financing activities :
Proceeds from issuance of equity shares (including treasury shares)		765			66
Repayment of short-term borrowings, net		(1,054	)		(16,862	)
Repayment of long term borrowings		(3,800	)		-
Proceeds from long term borrowings		3,800			-
Payment of principal portion of lease liabilities		(524	)		(499	)
Dividend paid		(6,648	)		(4,979	)
Interest paid		(1,051	)		(872	)
Net cash used in financing activities		(8,512	)		(23,146	)

Net increase/(decrease) in cash and cash equivalents		7,911			(6,400	)
Effect of exchange rate changes on cash and cash equivalents		(155	)		641
Cash and cash equivalents at the beginning of the period		5,779			14,852
Cash and cash equivalents at the end of the period(1)		13,535			9,093

*Rounded off to million.

**FVTPL (fair value through profit or loss)

(1)Adjusted for bank-overdraft of Rs. 4 million and Rs. 3 million for the half year ended 30 September 2023 and 30 September 2022, respectively.

The Company considered the uncertainties relating to the military conflict between Russia and Ukraine, in assessing the recoverability of receivables, goodwill, intangible assets, investments and other assets. For this purpose, the Company considered internal and external sources of information up to the date of approval of these financial results. Based on its judgments, estimates and assumptions, including sensitivity analysis, the Company expects to fully recover the carrying amount of receivables, goodwill, intangible assets, investments and other assets. The Company will continue to closely monitor any material changes to future economic conditions.

Place: Hyderabad

Date: 27 October 2023

By order of the Board

For Dr. Reddy's Laboratories Limited

G V Prasad

Co-Chairman & Managing Director

EX-99.3 4 drr0529_ex99-3.htm EXHIBIT 99.3

Exhibit 99.3

THE SKYVIEW 10

18th Floor, “NORTH LOBBY”

Survey No. 83/1, Raidurgam

Hyderabed - 500 032, India

Tel : + 91 40 6141 6000

Independent Auditor’s Review Report on the Quarterly and Year to Date Unaudited Consolidated Financial Results of the Company Pursuant to the Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended

Review Report to

The Board of Directors

Dr. Reddy’s Laboratories Limited

We have reviewed the accompanying Statement of Unaudited Consolidated Financial Results for the quarter and half year ended September 30, 2023 (the “Statement”) of Dr. Reddy’s Laboratories Limited (the “Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”) and its joint ventures attached herewith, being submitted by the Holding Company pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the “Listing Regulations”).

The Holding Company’s Management is responsible for the preparation of the Statement in accordance with the recognition and measurement principles laid down in Indian Accounting Standard 34, (Ind AS 34) “Interim Financial Reporting” prescribed under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India and in compliance with Regulation 33 of the Listing Regulations. The Statement has been approved by the Holding Company’s Board of Directors . Our responsibility is to express a conclusion on the Statement based on our review.

We conducted our review of the Statement in accordance with the Standard on Review Engagements (SRE) 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Institute of Chartered Accountants of India. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We also performed procedures in accordance with the Circular No. CIR/CFD/CMD1/44/2019 dated March 29, 2019 issued by the Securities and Exchange Board of India under Regulation 33(8) of the Listing Regulations, to the extent applicable.

The Statement includes the results of the following entities:

Holding Company:

Dr. Reddy’s Laboratories Limited

Subsidiaries

Aurigene Oncology limited (Formerly, Aurigene Discovery Technologies Limited)

Cheminor Investments Limited

Dr. Reddy’s Bio-Sciences Limited

Dr. Reddy’s Formulations Limited

Dr. Reddy’s Farmaceutica Do Brasil Ltda.

Dr. Reddy's Laboratories SA

Idea2Enterprises (India) Private Limited

Imperial Credit Private Limited

Industrias Quimicas Falcon de Mexico, S.A.de C.V.

10.

Svaas Wellness Limited

11.

Aurigene Discovery Technologies (Malaysia) Sdn. Bhd.

12.

Aurigene Pharmaceutical Services Limited

S.R. Batliboi& Associates LLP, a Limited Liability Partnership with LLP Identity No. AAB-4295

Regd. Office 22, Camac Street, Black ‘B’, 3rd floor, Kolkata 700 016

13.

beta Institut gemeinnützige GmbH

14.

betapharm Arzneimittel GmbH

15.

Chirotech Technology Limited (Under the process of liquidation)

16.

DRL Impex Limited

17.

Dr. Reddy’s Laboratories (Australia) Pty. Limited

18.

Dr. Reddy’s (Beijing) Pharmaceutical Co. Limited

19.

Dr. Reddy’s Laboratories Canada, Inc.

20.

Dr. Reddy's Laboratories Chile SPA.

21.

Dr. Reddy’s Laboratories (EU) Limited

22.

Dr. Reddy’s Laboratories Inc.

23.

Dr. Reddy's Laboratories Japan KK

24.

Dr. Reddy’s Laboratories Kazakhstan LLP

25.

Dr. Reddy’s Laboratories LLC, Ukraine

26.

Dr. Reddy's Laboratories Louisiana LLC

27.

Dr. Reddy’s Laboratories Malaysia Sdn. Bhd.

28.

Dr. Reddy’s Laboratories New York, LLC

29.

Dr. Reddy's Laboratories Philippines Inc.

30.

Dr. Reddy’s Laboratories (Proprietary) Limited

31.

Dr. Reddy's Laboratories Romania S.R.L.

32.

Dr. Reddy's Laboratories SAS

33.

Dr. Reddy's Laboratories Taiwan Limited

34.

Dr. Reddy's Laboratories (Thailand) Limited

35.

Dr. Reddy’s Laboratories (UK) Limited

36.

Dr. Reddy’s New Zealand Limited

37.

Dr. Reddy's Research and Development B.V.

38.

Dr. Reddy’s Srl

39.

Dr. Reddy's Venezuela, C.A.

40.

Dr. Reddy’s Laboratories LLC

41.

Lacock Holdings Limited

42.

Promius Pharma LLC

43.

Reddy Holding GmbH

44.

Reddy Netherlands B.V.

45.

Reddy Pharma Iberia SAU

46.

Reddy Pharma Italia S.R.L

47.

Reddy Pharma SAS

48.

Nimbus Health GmbH

49.

Dr. Reddy’s Laboratories Jamaica Limited (from 25 September 2023)

Joint ventures

DRES Energy Private Limited

Kunshan Rotam Reddy Pharmaceutical Company Limited

Other consolidating entities

Cheminor Employees Welfare Trust

Dr. Reddy's Employees ESOS Trust

Dr. Reddy's Research Foundation

Based on our review conducted and procedures performed as stated in paragraph 3 above, nothing has come to our attention that causes us to believe that the accompanying Statement, prepared in accordance with recognition and measurement principles laid down in the aforesaid Indian Accounting Standards (‘Ind AS’) specified under Section 133 of the Companies Act, 2013, as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India, has not disclosed the information required to be disclosed in terms of the Listing Regulations, including the manner in which it is to be disclosed, or that it contains any material misstatement.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm registration number: 101049W/E300004


per Shankar Srinivasan Partner Membership No.: 213271

UDIN: 23213271BGSEQU2517

Place: Hyderabad
Date: October 27, 2023.

Dr. Reddys Laboratories Ltd.

8-2-337, Road No. 3, Banjara Hills,

Hyderabad - 500 034, Telangana,
India.

CIN : L85195TG1984PLC004507

Tel : +91 40 4900 2900

Fax : +91 40 4900 2999

Email : mail@drreddys.com

www.drreddys.com

DR. REDDY'S LABORATORIES LIMITED

STATEMENT OF UNAUDITED CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER AND HALF YEAR ENDED 30 SEPTEMBER 2023

All amounts in Indian Rupees millions

		Quarter ended									Half year ended						Year ended
Sl. No.	Particulars	30.09.2023			30.06.2023			30.09.2022			30.09.2023			30.09.2022			31.03.2023
		(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Audited)

1	Revenue from operations
	a) Net sales/income from operations		67,348			66,143			61,632			133,491			109,812			234,595
	b) License fees and service income		1,454			1,241			1,425			2,695			5,399			11,284
	c) Other operating income		224			195			261			419			436			818

	Total revenue from operations		69,026			67,579			63,318			136,605			115,647			246,697

2	Other income		3,150			1,740			408			4,890			8,825			10,555

3	Total income (1 + 2)		72,176			69,319			63,726			141,495			124,472			257,252

4	Expenses
	a) Cost of materials consumed		9,559			12,968			6,688			22,527			18,579			42,198
	b) Purchase of stock-in-trade		11,378			8,771			8,089			20,149			16,844			33,670
	c) Changes in inventories of finished goods, work-in-progress and stock-in-trade		(907	)		(2,363	)		3,693			(3,270	)		2,160			709
	d) Employee benefits expense		12,803			11,897			11,517			24,700			21,974			46,466
	e) Depreciation and amortisation expense		3,755			3,533			3,092			7,288			6,110			12,502
	f) Impairment of non-current assets		55			11			25			66			25			699
	g) Finance costs		353			371			309			724			656			1,428
	h) Selling and other expenses		16,055			15,674			14,317			31,729			27,542			59,465

	Total expenses		53,051			50,862			47,730			103,913			93,890			197,137

5	Profit before tax and before share of equity accounted investees(3 - 4)		19,125			18,457			15,996			37,582			30,582			60,115

6	Share of profit of equity accounted investees, net of tax		42			43			140			85			234			370

7	Profit before tax (5+6)		19,167			18,500			16,136			37,667			30,816			60,485

8	Tax expense/(benefit):
	a) Current tax		5,901			7,197			3,674			13,098			769			8,144
	b) Deferred tax		(1,556	)		(2,747	)		1,320			(4,303	)		7,015			7,268

9	Net profit after taxes and share of profit of associates (7 - 8)		14,822			14,050			11,142			28,872			23,032			45,073

10	Other comprehensive income
	a) (i) Items that will not be reclassified subsequently to profit or loss		(222	)		106			(112	)		(116	)		(674	)		(660	)
	(ii) Income tax relating to items that will not be reclassified to profit or loss		-			-			-			-			-			(43	)
	b) (i) Items that will be reclassified subsequently to profit or loss		(1,113	)		147			(189	)		(966	)		(3,324	)		276
	(ii) Income tax relating to items that will be reclassified to profit or loss		201			(210	)		(320	)		(9	)		1,248			306
	Total other comprehensive (loss)/income		(1,134	)		43			(621	)		(1,091	)		(2,750	)		(121	)

11	Total comprehensive income (9 + 10)		13,688			14,093			10,521			27,781			20,282			44,952

12	Paid-up equity share capital (face value Rs. 5/- each)		834			833			832			834			832			833

13	Other equity																	232,028

14	Earnings per equity share (face value Rs. 5/- each)

	Basic		89.09			84.55			67.13			173.64			138.77			271.47
	Diluted		88.91			84.36			66.98			173.27			138.47			270.90
			(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)
	See accompanying notes to the financial results

DR. REDDY'S LABORATORIES LIMITED

Segment information

All amounts in Indian Rupees millions

		Quarter ended						Half year ended				Year ended
Sl. No.	Particulars	30.09.2023		30.06.2023		30.09.2022		30.09.2023		30.09.2022		31.03.2023
		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)		(Audited)
	Segment wise revenue and results:
1	Segment revenue :
	a) Pharmaceutical Services and Active Ingredients		9,625		9,365		8,230		18,990		16,493		37,195
	b) Global Generics		61,130		60,130		56,009		121,260		100,380		213,953
	c) Others		683		593		755		1,276		1,493		3,126
	Total		71,438		70,088		64,994		141,526		118,366		254,274
	Less: Inter-segment revenue		2,412		2,509		1,676		4,921		2,719		7,577
	Total revenue from operations		69,026		67,579		63,318		136,605		115,647		246,697

2	Segment results:
	Gross profit from each segment
	a) Pharmaceutical Services and Active Ingredients		1,260		1,013		235		2,273		1,350		4,733
	b) Global Generics		38,872		38,386		36,568		77,258		60,967		132,719
	c) Others		242		156		447		398		944		1,909
	Total		40,374		39,555		37,250		79,929		63,261		139,361
	Less: Selling and other un-allocable expenditure/(income), net		21,207		21,055		21,114		42,262		32,445		78,876
	Total profit before tax		19,167		18,500		16,136		37,667		30,816		60,485

Global Generics includes operations of Biologics business. Inter-segment revenue represents sale from Pharmaceutical Services and Active Ingredients to Global Generics and others at cost.

Segmental capital employed

As certain assets of the Company including manufacturing facilities, development facilities and treasury assets and liabilities are often deployed interchangeably across segments, it is impractical to allocate these assets and liabilities to each segment. Hence, the details for capital employed have not been disclosed in the above table.

Notes:

1	The above statement of unaudited consolidated financial results of Dr. Reddy's Laboratories Limited ("the Company"), which have been prepared in accordance with Indian Accounting Standards ("Ind AS") prescribed under section 133 of Companies Act,2013 ("the Act") read with relevant rules issues thereunder, other accounting principles generally accepted in India and guidelines issues by the Securities and Exchange Board of India ("SEBI") were reviewed and recommended by Audit Committee and approved by the Board of Directors at their meetings held on 27 October 2023. The Statutory Auditors have carried out a limited review on the unaudited consolidated financial results and issued an unmodified report thereon.
2	“Other income” for the quarter ended 30 September 2023 includes Rs.984 million recognized pursuant to settlement of product related litigation by the Company and its affiliates in the United Kingdom. This transaction pertains to the Company's Global Generics segment.
3	"Other income" for the quarter ended 30 June 2023 includes Rs.540 million recognised pursuant to settlement agreement with Janssen Group, in settlement of the claim brought in the Federal Court of Canada by the Company and its affiliates for damages under section 8 of the Canadian Patented Medicines (Notice of Compliance) Regulations in regard to the Company’s ANDS for a generic version of Zytiga®(Abiraterone).This transaction pertains to the Company's Global Generics segment.
4	During the half year and quarter ended 30 September 2023, an amount of Rs.2,274 million and Rs.1,598 million, respectively, representing government grants has been accounted as a reduction from cost of revenues.
5	During the quarter ended 30 September 2022 Rs.1,933 million, representing government grants has been accounted as a reduction from cost of revenues.
6	License fee and service income for the year ended 31 March 2023 includes: a. Rs. 2,640 million from sale of certain non-core dermatology brands to Eris Lifesciences Limited; b. Rs. 1,399 million from sale of brands Styptovit-E, Finast, Finast-T and Dynapres to Torrent Pharmaceuticals Limited; c. Rs. 902 million from sale of brands Z&D, Pedicloryl, Pecef and Ezinapi to J B Chemicals and Pharmaceuticals Limited. The amounts recognised above are adjusted for expected sales returns. These transactions pertain to Company’s Global Generics segment.
7	During the year ended 31 March 2023, Company considered a total impairment of Rs. 540 million towards: a. The Company assessed performance of business acquired from Nimbus Health GmbH against the initial estimates and performance of the products. Basis the assessment, the Company has recorded an impairment charge of the carrying values amounting to Rs. 375 million (Goodwill- Rs. 272 million and Other intangibles- Rs. 103 million). The said impairment charge pertains to the Company’s Global Generics segment. b. Consequent to adverse market conditions with respect to certain of the Company’s products related intangibles forming part of the Company’s Global Generics and Pharmaceutical Services and Active Ingredients segments, the Company assessed the recoverable amount of these products and recognised an amount of Rs. 165 million as impairment charge.
8	Included in “Selling and other expenses” for the year ended 31 March 2023, is an amount of Rs. 991 million representing the Loss on sale of Assets, pursuant to agreement dated 16 December 2022 with Delpharm Development Leiden B.V (Delpharm) for transfer of its certain assets, liabilities and employees at its site at Leiden, Netherlands.This transaction pertains to Company’s Global Generics segment.
9	The Company has considered the impact of recent tax regulations and developments, including updates to its estimate on the impact of adoption of the Taxation Laws (Amendment) Act 2019, in determining its “Tax expense/(benefit)” for the half year ended 30 September 2023 and year ended 31 March 2023.
10	"Other income" for the half year ended 30 September 2022 includes an amount of Rs.5,638 million (U.S.$71.39 million discounted to present value) towards the settlement of an ongoing litigation relating to launch of a product with Indivior Inc., Indivior UK Limited and Aquestive Therapeutics, Inc.
11	The Company received an anonymous complaint in September 2020, alleging that healthcare professionals in Ukraine and potentially in other countries were provided with improper payments by or on behalf of the Company in violation of U.S. anti-corruption laws, specifically the U.S. Foreign Corrupt Practices Act. The Company disclosed the matter to the U.S. Department of Justice (“DOJ”), Securities and Exchange Commission (“SEC”) and Securities Exchange Board of India. The Company engaged a U.S. law firm to conduct the investigation at the instruction of a committee of the Company’s Board of Directors. On 06 July 2021 the Company received a subpoena from the SEC for the production of related documents, which were provided to the SEC. The Company made presentations to the SEC and the DOJ in relation to the investigation with respect to certain countries during the previous fiscal years. The Company also made a presentation to the SEC and the DOJ in relation to its Global Compliance Framework, including the ongoing enhancement initiatives, during the year ended 31 March 2023. The Company is complying with its listing obligations as it relates to updating the regulatory agencies. While the findings from the aforesaid investigations could result in government or regulatory enforcement actions against the Company in the United States and/or foreign jurisdictions, which can lead to civil and criminal sanctions under relevant laws, the outcomes including liabilities are not reasonably ascertainable at this time.

DR. REDDY'S LABORATORIES LIMITED

Consolidated Balance Sheet

	All amounts in Indian Rupees millions
	As at
	30.09.2023		31.03.2023
Particulars	(Unaudited)		(Audited)
ASSETS
Non-current assets
Property, plant and equipment		58,496		56,542
Capital work-in-progress		11,514		9,752
Goodwill		5,410		5,474
Other intangible assets		36,384		30,175
Intangible assets under development		609		549
Investment in equity accounted investees		4,069		4,702
Financial assets
Investments		1,855		660
Other financial assets		738		727
Deferred tax assets, net		10,732		7,052
Tax assets, net		298		2,687
Other non-current assets		592		276
Total non-current assets		130,697		118,596

Current assets
Inventories		56,592		48,670
Financial assets
Investments		38,650		44,496
Trade receivables		69,722		72,485
Derivative financial instruments		731		1,232
Cash and cash equivalents		13,539		5,779
Other bank balances		15,740		11,523
Other financial assets		4,582		4,950
Other current assets		17,841		15,120
Total current assets		217,397		204,255
TOTAL ASSETS		348,094		322,851

EQUITY AND LIABILITIES
Equity
Equity share capital		834		833
Other equity		254,134		232,028
Total equity		254,968		232,861

Liabilities
Non-current liabilities
Financial liabilities
Borrowings		3,800		-
Lease liabilities		2,243		1,278
Provisions		194		199
Deferred tax liabilities, net		100		760
Other non-current liabilities		2,724		2,032
Total non-current liabilities		9,061		4,269

Current liabilities
Financial liabilities
Borrowings		5,851		11,190
Lease liabilities		1,336		1,004
Trade payables
Total outstanding dues of micro enterprises and small enterprises		89		83
Total outstanding dues of creditors other than micro enterprises and small enterprises		27,163		22,601
Derivative financial instruments		542		137
Other financial liabilities		28,390		29,175
Liabilities for current tax, net		3,985		2,143
Provisions		6,305		6,525
Other current liabilities		10,404		12,863
Total current liabilities		84,065		85,721
TOTAL EQUITY AND LIABILITIES		348,094		322,851

Dr. Reddy's Laboratories Limited

Consolidated statement of cashflows

	All amounts in Indian Rupees millions
	Half year ended
	30.09.2023			30.09.2022
Particulars	(Unaudited)			(Unaudited)
Cash flows from/(used in) operating activities :
Profit before tax		37,667			30,816
Adjustments for:
Fair value changes and profit on sale of financial instruments measured at FVTPL**, net		(1,527	)		(78	)
Depreciation and amortisation expense		7,288			6,110
Impairment of non-current assets		66			25
Allowance for credit losses (on trade receivables and other advances)		137			69
(Profit)/loss on sale or de-recognition of non-current assets, net		(445	)		68
Share of profit of equity accounted investees		(85	)		(234	)
Foreign exchange (gain), net		(1,179	)		(329	)
Interest income		(1,048	)		(433	)
Finance costs		724			656
Equity settled share-based payment expense		211			263
Inventories write-down		1,418			2,732
Dividend income		-			-	*
Changes in operating assets and liabilities:
Trade and other receivables		2,689			(10,150	)
Inventories		(9,340	)		(890	)
Trade and other payables		4,568			(2,356	)
Other assets and other liabilities, net		(3,482	)		(5,693	)
Cash generated from operations		37,662			20,576
Income tax paid, net		(8,486	)		(4,640	)
Net cash from operating activities		29,176			15,936
Cash flows (used in)/from investing activities :
Expenditures on property, plant and equipment		(7,323	)		(5,816	)
Proceeds from sale of property, plant and equipment		487			48
Expenditures on other intangible assets		(8,787	)		(6,203	)
Proceeds from sale of other intangible assets		21			-
Purchase of investments		(70,008	)		(47,008	)
Proceeds from sale of investments		71,815			59,395
Interest and dividend received		597			394
Dividend received from equity accounted investees		445			-
Net cash (used in)/from investing activities		(12,753	)		810

Cash flows (used in) financing activities :
Proceeds from issuance of equity shares (including treasury shares)		765			66
Repayment of short-term borrowings, net		(1,054	)		(16,862	)
Repayment of long-term loans and borrowings		(3,800	)		-
Proceeds from long term borrowings		3,800			-
Payment of principal portion of lease liabilities		(524	)		(499	)
Dividend paid		(6,648	)		(4,979	)
Interest paid		(1,051	)		(872	)
Net cash used in financing activities		(8,512	)		(23,146	)

Net increase/(decrease) in cash and cash equivalents		7,911			(6,400	)
Effect of exchange rate changes on cash and cash equivalents		(155	)		641
Cash and cash equivalents at the beginning of the period		5,779			14,852
Cash and cash equivalents at the end of the period(1)		13,535			9,093

* Rounded off to million.

** FVTPL (fair value through profit or loss)

(1) Adjusted for bank-overdraft of Rs. 4 million and Rs. 3 million for the half year ended 30 September 2023 and 30 September 2022, respectively.

			By order of the Board
			For Dr. Reddy’s Laboratories Limited


Place: Hyderabad			G V Prasad
Date: 27 October 2023			Co-Chairman & Managing Director

EX-99.4 5 drr0529_ex99-4.htm EXHIBIT 99.4

Exhibit 99.4

THE SKYVIEW 10

18th Floor, “NORTH LOBBY”

Survey No. 83/1, Raidurgam

Hyderabed - 500 032, India

Tel : + 91 40 6141 6000

Independent Auditor’s Review Report on the Quarterly and Year to Date Unaudited Standalone Financial Results of the Company Pursuant to the Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended

Review Report to

The Board of Directors

Dr. Reddy’s Laboratories Limited

We have reviewed the accompanying statement of unaudited standalone financial results for the quarter and half year ended September 30, 2023 (the “Statement”) of Dr. Reddy’s Laboratories Limited (the “Company”) attached herewith, being submitted by the Company pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the “Listing Regulations”).

The Company’s Management is responsible for the preparation of the Statement in accordance with the recognition and measurement principles laid down in Indian Accounting Standard 34, (Ind AS 34) “Interim Financial Reporting” prescribed under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India and in compliance with Regulation 33 of the Listing Regulations. The Statement has been approved by the Company’s Board of Directors. Our responsibility is to express a conclusion on the Statement based on our review.

Based on our review conducted as above, nothing has come to our attention that causes us to believe that the accompanying Statement, prepared in accordance with the recognition and measurement principles laid down in the aforesaid Indian Accounting Standards (‘Ind AS’) specified under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India, has not disclosed the information required to be disclosed in terms of the Listing Regulations, including the manner in which it is to be disclosed, or that it contains any material misstatement.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm registration number: 101049W/E300004

per Shankar Srinivasan

Partner

Membership No.: 213271

UDIN: 23213271BGSEQV8129

Place: Hyderabad

Date: October 27, 2023

S.R. Batliboi& Associates LLP, a Limited Liability Partnership with LLP Identity No. AAB-4295

Regd. Office 22, Camac Street, Black ‘B’, 3rd floor, Kolkata 700 016

Dr. Reddy’s Laboratories Ltd.

8-2-337, Road No. 3, Banjara Hills,

Hyderabad - 500 034, Telangana,

India.

CIN : L85195TG1984PLC004507

Tel :+91 40 4900 2900

Fax :+91 40 4900 2999

Email :mail@drreddys.com

www.drreddys.com

DR. REDDY'S LABORATORIES LIMITED

STATEMENT OF UNAUDITED STANDALONE FINANCIAL RESULTS FOR THE QUARTER AND HALF YEAR ENDED 30 SEPTEMBER 2023

												All amounts in Indian Rupees millions
			Quarter ended									Half year ended						Year ended
Sl. No.		Particulars	30.09.2023			30.06.2023			30.09.2022			30.09.2023			30.09.2022			31.03.2023
			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Audited)

	1	Revenue from operations
		a) Net sales/income from operations		48,037			54,034			48,475			102,071			81,874			162,989
		b) License fees and service income		154			167			186			321			2,943			6,002
		c) Other operating income		196			172			142			368			292			634
		Total revenue from operations		48,387			54,373			48,803			102,760			85,109			169,625

	2	Other income		2,231			2,336			1,180			4,567			5,214			5,913

		Total income (1 + 2)		50,618			56,709			49,983			107,327			90,323			175,538

	3	Expenses
		a) Cost of materials consumed		7,512			8,139			6,367			15,651			14,414			31,614
		b) Purchase of stock-in-trade		4,992			3,842			4,391			8,834			9,227			17,793
		c) Changes in inventories of finished goods, work-in-progress and stock-in-trade		(1,054	)		(163	)		1,336			(1,217	)		1,508			1,295
		d) Employee benefits expense		7,837			7,402			7,101			15,239			13,591			28,326
		e) Depreciation and amortisation expense		2,458			2,372			2,262			4,830			4,477			9,232
		f) Impairment of non-current assets		-			-			-			-			-			51
		g) Finance costs		58			45			17			103			115			169
		h) Selling and other expenses		12,809			12,876			11,580			25,685			22,546			48,398

		Total expenses		34,612			34,513			33,054			69,125			65,878			136,878


	4	Profit before tax (1 + 2 - 3)		16,006			22,196			16,929			38,202			24,445			38,660

	5	Tax expense/(benefit)
		a) Current tax		3,960			5,387			2,976			9,347			4,334			8,641
		b) Deferred tax		120			415			2,790			535			3,953			3,891

	6	Net profit for the period/year (4 - 5)		11,926			16,394			11,163			28,320			16,158			26,128

	7	Other comprehensive income
		a) (i) Items that will not be reclassified to profit or loss		1			1			2			2			1			89

		(ii) Income tax relating to items that will not be reclassified to profit or loss		-			-			-			-			-			(53	)

		b) (i) Items that will be reclassified to profit or loss		(802	)		521			912			(281	)		(3,574	)		(928	)

		(ii) Income tax relating to items that will be reclassified to profit or loss		201			(130	)		(320	)		71			1,248			358

		Total other comprehensive income		(600	)		392			594			(208	)		(2,325	)		(534	)

	8	Total comprehensive income (6 + 7)		11,326			16,786			11,757			28,112			13,833			25,594

	9	Paid-up equity share capital (face value Rs. 5/- each)		834			833			832			834			832			833

	10	Other equity																	203,909

	11	Earnings per equity share (face value Rs. 5/- each)

		Basic		71.68			98.66			67.25			170.32			97.35			157.37
		Diluted		71.54			98.45			67.10			169.96			97.14			157.03
				(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)			(Not annualised)

See accompanying notes to the financial results.

DR. REDDY’S LABORATORIES LIMITED

Segment information

All amounts in Indian Rupees millions

		Quarter ended									Half year ended						Year ended
Sl. No.	Particulars	30.09.2023			30.06.2023			30.09.2022			30.09.2023			30.09.2022			31.03.2023
		(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)			(Audited)
	Segment wise revenue and results
1	Segment revenue
	a) Pharmaceutical Services and Active Ingredients		6,357			6,885			6,452			13,242			12,428			27,896
	b) Global Generics		43,995			49,678			43,829			93,673			75,050			147,999
	c) Others		128			131			106			259			258			497
	Total		50,480			56,694			50,387			107,174			87,736			176,392

	Less: Inter-segment revenue		2,093			2,321			1,584			4,414			2,627			6,767
	Total revenue from operations		48,387			54,373			48,803			102,760			85,109			169,625

2	Segment results
	Profit/(loss) before tax and interest from each segment
	a) Pharmaceutical Services and Active Ingredients		(540	)		(596	)		(869	)		(1,136	)		(1,151	)		(1,336	)
	b) Global Generics		16,174			22,492			19,040			38,666			30,164			46,716
	c) Others		108			(9	)		(28	)		99			(6	)		(154	)
	Total		15,742			21,887			18,143			37,629			29,007			45,226

	Less: (i) Finance costs		58			45			17			103			115			169
	(ii) Other un-allocable expenditure/(income), net		(322	)		(354	)		1,197			(676	)		4,447			6,397
	Total profit before tax		16,006			22,196			16,929			38,202			24,445			38,660

Global Generics includes operations of Biologics business. Inter-segment revenue represents sale from Pharmaceutical Services and Active Ingredients to Global Generics at cost.

Segmental capital employed

Notes:

The above statement of unaudited standalone financial results of Dr. Reddy's Laboratories Limited ("the Company"), which have been prepared in accordance with the Indian Accounting Standards (''Ind AS'') prescribed under Section 133 of the Companies Act, 2013 ("the Act'') read with relevant rules issued thereunder, other accounting principles generally accepted in India and guidelines issued by the Securities and Exchange Board of India ("SEBI'') were reviewed and recommended by the Audit Committee and approved by the Board of Directors at their meetings held on 27 October 2023. The Statutory Auditors have carried out a limited review on the unaudited standalone financial results and issued unmodified report thereon.

During the quarter and half year ended 30 September 2023, an amount of Rs. 1,590 million and Rs. 2,263 million respectively, representing government grants has been accounted as a reduction from cost of material consumed.

During the quarter ended 30 September 2022, an amount of Rs. 1,933 million representing government grants has been accounted as a reduction from cost of material consumed.

Other income for the quarter ended 30 June 2023 includes Rs.540 million recognised pursuant to settlement agreement with Janssen Group, in settlement of the claim brought in the Federal Court of Canada by the Company and its affiliates for damages under section 8 of the Canadian Patented Medicines (Notice of Compliance) Regulations in regard to the Company’s ANDS for a generic version of Zytiga®(Abiraterone).This transaction pertains to the Company's Global Generics segment.

Other income for the quarter ended 30 June 2023 includes dividend income of Rs. 443 million declared by Kunshan Rotan Reddy Pharmaceutical Company Limited.

License fee and service income for the year ended 31 March 2023 includes: a. Rs. 2,640 million from sale of certain non-core dermatology brands in India to Eris Lifesciences Limited; b. Rs. 1,399 million from sale of brands Styptovit-E, Finast, Finast-T and Dynapres to Torrent Pharmaceuticals Limited; c. Rs. 902 million from sale of brands Z&D, Pedicloryl, Pecef and Ezinapi to J B Chemicals and Pharmaceuticals Limited; The amounts recognised above are adjusted for expected sales returns. These transactions pertain to the Company’s Global Generics segment.

The Company has considered the impact of recent tax regulations and developments, including updates to its estimate on the impact of adoption of the Taxation Laws (Amendment) Act 2019, in determining its “Tax expense/(benefit)” for the half year ended 30 September 2023 and year ended 31 March 2023.

DR. REDDY'S LABORATORIES LIMITED

Balance sheet

	All amounts in Indian Rupees millions
	As at		As at
Particulars	30.09.2023		31.03.2023
	(Unaudited)		(Audited)
ASSETS
Non-current assets
Property, plant and equipment		48,011		47,379
Capital work-in-progress		10,483		8,991
Goodwill		853		853
Other intangible assets		23,704		23,835
Intangible assets under development		139		139
Financial assets
Investments		33,026		31,422
Loans		613		11
Other financial assets		537		533
Deferred tax assets, net		268		-
Tax assets, net		-		2,546
Other non-current assets		424		156
Total non-current assets		118,058		115,865

Current assets
Inventories		36,136		30,430
Financial assets
Investments		35,842		42,978
Trade receivables		56,604		42,889
Derivative instruments		253		715
Cash and cash equivalents		1,116		1,123
Other bank balances		15,673		5,335
Other financial assets		1,401		2,224
Other current assets		14,782		12,189
Total current assets		161,807		137,883

TOTAL ASSETS		279,865		253,748

EQUITY AND LIABILITIES
Equity
Equity share capital		834		833
Other equity		226,348		203,909
Total Equity		227,182		204,742

Liabilities
Non-current liabilities
Financial liabilities
Lease liabilities		440		286
Provisions		79		79
Deferred tax liabilities, net		4,124		3,392
Other non-current liabilities		1,029		852
Total non-current liabilities		5,672		4,609

Current liabilities
Financial liabilities
Borrowings		-		6
Lease liabilities		359		216
Trade payables
Total outstanding dues of micro enterprises and small enterprises		67		72
Total outstanding dues of creditors other than micro enterprises and small enterprises		20,590		17,573
Derivative instruments		175		135
Other financial liabilities		15,296		15,369
Liabilities for current tax, net		1,790		-
Provisions		2,978		3,052
Other current liabilities		5,756		7,974
Total current liabilities		47,011		44,397

TOTAL EQUITY AND LIABILITIES		279,865		253,748

DR. REDDY'S LABORATORIES LIMITED

Statement of cashflows

	All amounts in Indian Rupees millions
	Half year ended
Particulars	30.09.2023			30.09.2022
	(Unaudited)			(Unaudited)
Cash flows from/(used in) operating activities :
Profit before tax		38,202			24,445
Adjustments for:
Fair value changes and profit on sale of financial instruments measured at FVTPL**, net		(1,477	)		(56	)
Depreciation and amortisation expense		4,830			4,477
Allowance for credit losses (on trade receivables and other advances)		111			63
(Profit)/Loss on sale/disposal of property , plant and equipment and other intangible assets, net		(380	)		71
Inventory write-downs		769			2,119
Foreign exchange loss/(gain), net		105			472
Interest income		(1,425	)		(618	)
Dividend from subsidiary, joint ventures and other entities		(445	)		-	*
Finance costs		103			115
Equity settled share-based payment expense		180			212
Changes in operating assets and liabilities:
Trade receivables		(13,753	)		(11,033	)
Inventories		(6,475	)		834
Trade payables		3,012			(611	)
Other assets and other liabilities, net		(3,014	)		(1,194	)
Cash flow generated from operations		20,343			19,296
Income taxes paid, net		(4,643	)		(3,178	)
Net cash from operating activities		15,700			16,118

Cash flows from/(used in) investing activities :
Proceeds from sale of property, plant and equipment		414			106
Expenditures on property, plant and equipment		(6,379	)		(5,020	)
Proceeds from sale of other intangible assets		21			-
Expenditures on other intangible assets		(964	)		(5,160	)
Purchase of investments		(65,458	)		(46,353	)
Proceeds from sale of investments		62,762			57,444
Purchase of equity investments of subsidiary		(500	)		(459	)
Dividend income received		445			-	*
Interest income received		683			550
Loans and advances given to subsidiaries		(602	)		(50	)
Net cash (used in)/from investing activities		(9,578	)		1,058

Cash flows from/(used in) financing activities :
Proceeds from issuance of equity shares (including treasury shares)		765			66
Proceeds from/(repayment of ) short-term loans and borrowings, net		(6	)		(18,711	)
Payment of principle portion of lease liabilities		(126	)		(133	)
Dividend paid		(6,648	)		(4,979	)
Interest paid		(117	)		(234	)
Net cash used in financing activities		(6,132	)		(23,991	)

Net (decrease)/increase in cash and cash equivalents		(10	)		(6,815	)
Effect of exchange rate changes on cash and cash equivalents		3			430
Cash and cash equivalents at the beginning of the period		1,123			11,595
Cash and cash equivalents at the end of the period(1)		1,116			5,210

* Rounded off to million.

** FVTPL (fair value through profit or loss)

(1) Adjusted for bank overdraft of Rs. Nil and Rs. 3 million for periods ended 30 September 2023 and 30 September 2022 respectively.


		By order of the Board
		For Dr. Reddy's Laboratories Limited


Place: Hyderabad		G V Prasad
Date: 27 October 2023		Co-Chairman & Managing Director