Dr. Reddy’s Q4FY26 Results: Reports 86% Drop In Profit, 12% Fall In Revenue

Dr. Reddy’s Laboratories reported a steep decline in earnings for the March quarter, as weaker sales of its key cancer drug Lenalidomide and a one-time shelf stock adjustment hurt performance.

Consolidated net profit for Q4FY26 fell 86% year-on-year to ₹221 crore from ₹1,587 crore in the corresponding quarter last year. Revenue from operations also dropped 12% to ₹7,516 crore against ₹8,506 crore a year ago.

Alongside the results, Dr. Reddy’s announced a final dividend of ₹8 per equity share for FY26, subject to shareholder approval at the upcoming annual general meeting. The record date for eligible shareholders has been fixed as 10 July 2026.

On 13 May, Dr. Reddy's shares were trading at ₹1,254.90, or 1.19% down at 12:06 pm IST.

Q4 Numbers At A Glance

• Net profit fell 86% YoY to ₹221 crore.

• Revenue declined 12% YoY to ₹7,516 crore.

• EBITDA dropped 60% YoY to ₹981 crore.

• EBITDA margin stood at 13% versus 29.1% last year.

• Gross margin came in at 44.8% for the quarter.

• Final dividend declared at ₹8 per share

Why Did Dr. Reddy’s Earnings Fall?

The pharma major said its North America business was impacted by lower Lenalidomide sales and a one-time Shelf Stock Adjustment (SSA) related to the product. The adjustment alone affected revenue by nearly ₹450 crore during the quarter.

The company also faced pressure from price erosion across North American and European generics markets. Gross margin for Q4FY26 stood at 44.8%, down 1,074 basis points year-on-year and 881 basis points sequentially.

Dr. Reddy’s further booked impairment charges linked to CAR-T assets and Eftilagimod Alfa, along with provisions related to VAT liabilities.

On a quarter-on-quarter basis, profit after tax declined 81% from ₹1,190 crore reported in Q3FY26. Revenue also slipped 14% sequentially from ₹8,727 crore.

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How Did The Company Perform In FY26?

Despite a weak March quarter, Dr. Reddy’s reported modest growth for the full financial year. Revenue for FY26 increased 3% to ₹33,593 crore from ₹32,553 crore in FY25.

The company said growth remained broad-based across key markets, except North America. Favourable foreign exchange movements also supported overall growth during the year.

Excluding the one-time shelf stock adjustment, consolidated revenue stood at ₹7,970 crore in Q4FY26, reflecting a 6.3% year-on-year decline. For the full year, adjusted revenue came in at ₹34,050 crore, marking a 4.6% increase over the previous year.

Sources:

NDTV Profit

The Economic Times