Dr. Reddy’s to Set up a Subsidiary in Jamaican For Nutraceuticals and Supplements
28-Sep-2023, the board of directors of Dr. Reddy’s Laboratories approved the incorporation of a wholly-owned subsidiary dedicated to nutraceuticals, vitamins, minerals, herbals, and supplements. The company, headquartered in Hyderabad, India, aims to concentrate on "health and wellbeing," encompassing medical nutrition, specialized nutrition, supplements, and related products. Dr. Reddy’s has been actively seeking to expand its presence in emerging segments like nutraceuticals, as highlighted in its 2022-23 annual report.
Chairman K. Satish Reddy expressed the company's vision for the future of healthcare, which includes a deeper involvement in nutraceuticals, as well as ventures into cell and gene therapy and new chemical entities (NCEs).
In July, Dr. Reddy’s Laboratories entered the child nutrition market with the launch of CeleHealth Kidz Immuno Plus Gummies in India.
According to market research firm IMARC, the Indian dietary supplements market was valued at ₹43,650 crore in 2022 and is projected to reach ₹95,810 crore by 2028, with a compound annual growth rate (CAGR) of 13.5% during 2023-28.
Dr. Reddy's Laboratories stock is currently trading at ₹5,606.50 on the National Stock Exchange, up 3.27% from the previous day's closing price of September 28, following the announcement of the subsidiary incorporation.
Dr. Reddy's Laboratories Expands Global Presence with Subsidiary in Jamaica
Dr. Reddy’s Laboratories' Switzerland unit established a wholly owned subsidiary in Jamaica, Dr. Reddy’s Laboratories Jamaica Limited" is a fully owned subsidiary of the company, with a focus on importation, distribution, warehousing, and exportation of pharmaceuticals, according to the company filing
Financial Performance Highlights for Q1 2023
Dr. Reddy's Laboratories reported strong financial performance for the quarter ending June 30, 2023, with a net profit of ₹1,402.5 crore, representing an 18.1% increase compared to the same period the previous year. Notably, the company had a one-time gain of $72 million during the base quarter, received from British drugmaker Indivor as a settlement for a patent litigation related to the generic drug Suboxone.
Total revenues for the firm also saw significant growth, rising 7% quarter-on-quarter (QoQ) and 29% year-on-year (YoY) to reach ₹6,738.3 crore, earnings before interest, taxes, depreciation, and amortization (EBITDA) for the pharma giant amounted to ₹2,137.2 crore for Q1FY24, with a 31.7% margin of revenues, compared to ₹1,778.9 crore in the corresponding quarter of the previous year.
Over the past six months, Dr. Reddy’s stock has given a return of 18.88%, outperforming the benchmark Nifty50 index, which delivered a return of 14.30% over the same period. Furthermore, in the past year, the company's stock generated impressive returns of 28%.
This move signifies Dr. Reddy’s Laboratories' commitment to diversifying its business and global presence, while also capitalizing on the growing market for nutraceuticals and dietary supplements in India.
In May 2023, company announced, Aurigene Pharmaceutical Services, a division of Dr. Reddy’s Laboratories, is embarking on a $40 million project to construct a production facility specializing in therapeutic proteins, antibodies, and viral vectors.
This facility will be situated within Genome Valley, a biotechnology hub in Hyderabad, India. According to the company, the construction will be finished by the first half of 2024. This expansion represents a step in the company's efforts to enhance its capabilities in the field of biopharmaceuticals.
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