4QFY2016 Result Update | Pharmaceutical
May 19, 2015
Dr Reddy’s Laboratories
BUY
CMP
`3,015
Performance Highlights
Target Price
`3,476
Y/E March (` cr)
4QFY2016 3QFY2016
% chg (qoq) 4QFY2015
% chg (yoy)
Investment Period
12 Months
Net sales
3,756
3,968
(5.3)
3,870
(3.0)
Gross profit
2,431
2,636
(7.8)
2,309
5.3
Stock Info
Operating profit
844
1,023
(17.4)
787
7.3
Sector
Pharmaceutical
Adj. net profit
376
579
(35.0)
519
(27.5)
Market Cap (` cr)
51,436
Source: Company, Angel Research
Net Debt (` cr)
(663)
For 4QFY2016, Dr Reddy’s Laboratories (DRL) posted results much lower than
Beta
0.7
our estimates. The company posted a 3.0% yoy de-growth in sales to `3,756cr
52 Week High / Low
4,383/2,750
V/s `4,500cr expected and V/s `3,870cr in 4QFY2015. The sales dip mainly
Avg. Daily Volume
38,816
happened on account of flat global generics and a 22% dip in the PSAI segment.
Face Value (`)
5
On the operating front, the EBIT margin came in at 12.7% V/s 22.2% expected
BSE Sensex
25,774
and V/s 11.4% in 4QFY2015, mainly owing to lower sales and a 15.4% yoy rise
Nifty
7,891
in SG&A expenditure. Thus, the Adj. net profit came in at `376cr V/s `729cr
Reuters Code
REDY.BO
expected and V/s `519cr in 4QFY2015, a yoy de-growth of 27.5%. We recommend
Bloomberg Code
[email protected]
a Buy rating on the stock.
Sales lower than expected: The company posted a 3.0% yoy de-growth in sales to
Shareholding Pattern (%)
`3,756cr V/s `4,500cr expected and V/s `3,870cr in 4QFY2015. The sales dip
Promoters
25.6
mainly happened owing to flat global generics and a 22% dip in the PSAI
MF / Banks / Indian Fls
9.5
segment. In generics, its key market USA posted a 12% yoy growth, Europe
FII / NRIs / OCBs
56.7
posted an 18% yoy dip, while Emerging markets posted a dip of 31% during the
Indian Public / Others
8.2
quarter. On the operating front, the EBIT margin came in at 12.7% V/s 22.2%
expected and V/s 11.4% in 4QFY2015, mainly owing to lower sales and a 15.4%
rise in SG&A expenditure. Thus, the Adj. net profit came in at `376cr V/s `729cr
Abs. (%)
3m 1yr
3yr
expected and V/s `519cr in 4QFY2015, a yoy de-growth of 27.5%. However, on
Sensex
10.2
(5.7)
27.1
back of the Venezuela related write offs of `430cr, the reported net profit came in at
Dr Reddy
1.8
(13.7)
45.1
`75cr v/s `519cr in 4QFY2015, a de-growth of 85.6% yoy.
Outlook and valuation: We expect net sales to grow at a CAGR of 13.8% to
3-year Daily Price Chart
`20,021cr and adjusted EPS to record a
12.2% CAGR to
`173.8 over
FY2016-18E. On back of valuations, we recommend a Buy rating on the stock.
Key financials (IFRS Consolidated)
Y/E March (` cr)
FY2015
FY2016
FY2017E
FY2018E
Net sales
14,819
15,471
17,479
20,021
% chg
12.1
4.4
13.0
14.5
Net profit
2,218
2,001
2,600
2,965
% chg
3.1
(9.8)
29.9
14.0
Adj net profit
2,218
2,357
2,600
2,965
% chg
3.1
6.3
10.3
14.0
Source: Company, Angel Research
Adj. EPS (`)
130.2
138.2
152.4
173.8
EBITDA margin (%)
22.2
24.6
24.6
24.2
P/E (x)
23.2
21.8
19.8
17.3
RoE (%)
21.9
19.7
18.7
18.2
RoCE (%)
18.1
18.7
19.2
19.3
P/BV (x)
4.6
4.0
3.4
2.9
Sarabjit Kour Nangra
EV/Sales (x)
3.4
3.3
2.9
2.5
+91 2 39357600 Ext: 6806
EV/EBITDA (x)
15.5
13.4
11.8
10.3
[email protected]
Source: Company, Angel Research; Note: CMP as of May 17, 2016
Please refer to important disclosures at the end of this report
1
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Exhibit 1: 4QFY2016 performance (IFRS, consolidated)
Y/E March (` cr)
4QFY2016
3QFY2016
% chg (QoQ) 4QFY2015
% chg (yoy) FY2016
FY2015
% chg
Net sales
3,756
3,968
(5.3)
3,870
(3.0)
15,471
14,819
4.4
Other income
(234)
6
-
(11)
-
(183)
260
-
Total income
3,522
3,792
(7.1)
3,860
(8.7)
15,287
15,079
1.4
Gross profit
2,431
2,636
(7.8)
2,309
5.3
10,262
9,288
10.5
Gross margin (%)
64.7
66.4
59.7
66.3
62.7
SG&A expenses
1,163
1,204
(3.4)
1,008
15.4
4,570
4,259
7.3
R&D expenses
488
410
19.1
514
(5.2)
1,783
1,745
2.2
EBDITA
844
1,023
(17.4)
787
7.3
3,909
3,284
19.0
EBDITA (%)
22.5
25.8
-
20.3
25.3
22.2
-
Depreciation
303
277
9.4
187.2
62.0
1,034.3
747.4
(75.0)
Interest
-
-
-
-
-
-
PBT
307
752
(59.1)
589
(47.8)
2,691
2,797
(78.9)
Tax
174
179
(2.7)
74
134.4
713
598
19.2
Net Profit
133
573
(76.7)
515
(74.1)
1,978
2,199
(10.0)
Share of profit/ (loss) in associates
5.9
6.4
(7.8)
4.3
22.9
19.5
Reported net profit before exceptional
75
579
(87.1)
519
(85.6)
2,001
2,218
(9.8)
Exceptional items (loss) /profit
(431)
-
-
(509)
-
Reported PAT
75
579
(87.1)
519
(85.6)
2,001
2,218
(9.8)
Adj.Net Profit
376
579
(35.0)
519
(27.5)
2,357
2,218
6.3
EPS (`)
22.2
34.1
30.6
138.8
130.6
Source: Company, Angel Research
Exhibit 2: Actual vs Estimates
(` cr)
Actual
Estimates
Variation (%)
Net sales
3,756
4,500
(16.5)
Other income
(234)
20
-
Operating profit
844
1,002
(15.7)
Tax
174
296
(41.3)
Adj. Net profit
376
729
(48.4)
Source: Company, Angel Research
Revenue lower than expectation: The company posted a 3.0% yoy de-growth in
sales to `3,756cr V/s `4,500cr expected and V/s `3,870cr in 4QFY2015. The
sales dip mainly happened owing to flat global generics and a 22% dip in the PSAI
segment.
In the generic segment (accounting for 82% of sales), the US (`1,890cr) grew by
12% yoy, Europe (`176cr) de-grew by 18.0% yoy, India (`527cr) grew by
11.0% yoy, while Emerging Markets (including Russia & CIS; `479cr) de-grew by
31% yoy.
The India business delivered double digit growth for the eight consecutive quarter
on account of sustained improvement in the performance of the top brands.
According to AIOCD, Dr Reddy’s growth in domestic market was at
22%
(secondary market data) for the Jan-Mar’2016 quarter, much ahead of industry
yoy growth of 9.3%.
May 19, 2016
2
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
In the PSAI segment (15% of sales) - US de-grew by 60% yoy and ROW grew by
18% yoy. Europe de-grew by 2% yoy while India dipped by 10% yoy, during the
quarter. Proprietary Products & Others (`102cr) posted a yoy growth of 79%.
During FY2016, DRL filed for 14 new products in the US, taking the cumulative
ANDA filings to 230. Pending ANDAs stands at 82 including 52 Para IVs of which
18 are FTFs.
Exhibit 3: Trend in Global generics
3,500
3,000
401
480
270
310
329
2,500
581
546
527
476
474
2,000
194
191
212
176
234
1,500
1,000
1,852
1,856
1,942
1,895
1,715
500
0
4QFY2015
1QFY2016
2QFY2016
3QFY2016
4QFY2016
Others
Russia & CIS
India
Europe
North America
Source: Company, Angel Research
Exhibit 4: PSAI trend
800
700
212
600
500
66.8
208
184
201
147
400
60
72
59
62
300
322
200
243
195
259
235
100
140
104
66
69
74
0
4QFY2015
1QFY2016
2QFY2016
3QFY2016
4QFY2016
Others
India
Europe
North America
Source: Company, Angel Research
May 19, 2016
3
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
EBITDA dips yoy: On the operating front, the EBITDA margin came in at 22.5% V/s
28.9% expected and V/s 20.3% in 4QFY2015, weighed down by lower than
expected sales and 15.4% yoy growth in SG&A expenditure. R&D expenditure for
the quarter was 13.0% of sales V/s 13.3% in 4QFY2015.
Exhibit 5: EBITDA margin trend (%)
30.0
28.6
28.0
26.2
25.8
26.0
24.0
22.5
22.0
20.3
20.0
4QFY2015
1QFY2016
2QFY2016
3QFY2016
4QFY2016
Source: Company, Angel Research
Net profit lower than expected: Consequently, the net profit came in at `376cr
V/s `729cr expected and V/s `519cr in 4QFY2015, a yoy de-growth of
27.5%. This was owing to Venezuela related write offs of `430cr; the reported net
profit came in at `75cr v/s `519cr in 4QFY2015, a de-growth of 85.6% yoy.
Exhibit 6: Adjusted net profit trend
800
722
700
626
579
600
519
500
376
400
300
200
100
0
4QFY2015
1QFY2016
2QFY2016
3QFY2016
4QFY2016
Source: Company, Angel Research
May 19, 2016
4
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Concall takeaways
DRL provided 1st and 2nd update to USFDA on 28th Jan and 30th Mar 2016.
The company intends to finish the remediation procedure by 1QFY2017 end.
Russia business is to see revival in 2HFY2016.
Capex for FY2017 & FY2018 expected to be ~`1,200cr and should come
down thereafter.
Investment arguments
Robust growth in the US going ahead: After attaining a critical mass (US$1,139mn
in FY2016), DRL aims to scale up its business to the next orbit in the US market on
the back of a strong product pipeline (82 ANDAs are pending approval, of which,
52 are Para IVs and 18 are FTFs). The Management has guided for a robust
growth in the US over the medium term, driven by introduction of new products,
some of which are also Para IV opportunities. On back of the import alert on the
three facilities of the company, on worst case scenario, we expect the ex-exclusivity
US sales to post a CAGR of ~16.4% during FY2016-18E.
Domestic back in focus: DRL reported a 19.0% yoy growth in FY2016. The
Management expects the company’s performance to rebound and targets to
achieve an above industry growth rate going ahead, driven by a) field force
expansion and improvement in productivity, b) new product launches (including
biosimilars) and c) focus on brand building. In 4QFY2015, DRL had acquired
UCB’s India portfolio and has completed the integration process of these brands in
1QFY2016. UCB’s India business had registered ~`150cr sales in CY2014 and
has a branded portfolio of
21 products focusing on Allergy, Respiratory,
Dermatology and Pediatric space. The acquisition has been successfully integrated
by 2QFY2016. Thus, we expect sales in India to post a CAGR of ~16.0% over
FY2016-18E.
Valuation: We expect net sales to grow at a CAGR of 12.8% to `20,021cr and
adjusted EPS to record an 12.2% CAGR to `173.8 over FY2016-18E. The stock
has seen severe beating post the import alert from the USFDA. Considering the
valuations, we recommend a Buy with a reduced price target of `3,476.
Exhibit 7: Key assumptions
FY2017E
FY2018E
PSAI segment growth (%)
0.3
1.2
Generics segment growth (%)
15.0
16.4
Operating margin (%)
24.6
24.2
Capex (` cr)
1200
1200
Source: Company, Angel Research
May 19, 2016
5
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Exhibit 8: PE chart
6,000
5,000
4,000
3,000
2,000
1,000
0
Price
20x
25x
30x
35x
Source: Company, Angel Research
Exhibit 9: Recommendation summary
Company
Reco.
CMP Tgt Price Upside
FY2017E
FY15-17E
FY2017E
PE
EV/Sales
EV/EBITDA
CAGR in EPS
RoCE
RoE
(`)
(`)
(%)
(x)
(x)
(x)
(%)
(%)
(%)
Alembic Pharma
Neutral
573
-
-
20.0
2.7
14.1
11.4
23.5
21.3
Aurobindo Pharma Accumulate
776
856
10.3
18.1
2.9
12.7
15.6
23.5
30.2
Cadila Healthcare
Accumulate
321
352
9.5
18.3
2.7
12.5
24.6
25.2
29.0
Cipla
Buy
525
605
15.3
19.1
2.5
13.4
18.3
16.7
16.1
Dr Reddy's
Buy
3,015
3,476
15.3
19.8
2.9
11.8
6.8
19.2
18.7
Dishman Pharma
Neutral
158
-
-
15.8
1.7
7.9
15.9
9.4
11.0
GSK Pharma*
Neutral
3,429
-
-
50.2
8.8
39.8
6.6
33.7
34.3
Indoco Remedies
Neutral
265
-
-
19.4
2.1
11.6
23.0
19.7
19.7
Ipca labs
Buy
452
750
66.1
16.1
1.7
9.1
17.9
11.8
14.9
Lupin
Neutral
1,613
-
-
23.6
4.0
15.0
13.1
29.6
24.7
Sanofi India
Accumulate
4,305
4,738
10.1
28.0
3.9
22.3
34.2
21.0
25.6
Sun Pharma
Buy
800
950
18.8
29.7
5.2
17.0
8.4
15.8
16.6
Source: Company, Angel Research; Note: *December year ending
Company Background
Established in
1984, Dr Reddy's Laboratories is an integrated global
pharmaceutical company, through its three businesses - Pharmaceutical Services
and Active Ingredients, Global Generics and Proprietary Products. The key
therapeutic focus is on gastro-intestinal, cardiovascular, diabetology, oncology,
pain management, anti-infective and paediatrics. The key markets for DRL include
India, USA, Russia & CIS, and Germany.
May 19, 2016
6
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Profit & loss statement (IFRS Consolidated)
Y/E March
FY2013
FY2014
FY2015
FY2016E
FY2017E
FY2018E
Net sales
11,627
13,217
14,819
15,471
17,479
20,021
Other operating income
247.9
141.6
91.7
87.4
87.4
87.4
Total operating income
11,875
13,359
14,911
15,558
17,567
20,108
% chg
21.8
12.5
11.6
4.3
12.9
14.5
Total expenditure
8,951
10,096
11,535
11,669
13,186
15,184
Cost of revenues
4,825
4,977
5,531
5,315
6,071.51
7,035.66
SG&A expenses
3,358
3,878
4,259
4,570
5,017
5,746
R&D expenses
767.3
1,240.2
1,744.9
1,783.4
2,097.5
2,402.5
EBITDA
2,676
3,121
3,284
3,802
4,294
4,837
% chg
3.0
16.6
5.2
15.8
12.9
12.6
(% of Net Sales)
23.0
23.6
22.2
24.6
24.6
24.2
Depreciation & amortisation
743.7
659.8
747.4
927.4
990.1
1,052.8
EBIT
1,932
2,462
2,537
2,875
3,304
3,784
% chg
4.3
27.4
3.1
13.3
14.9
14.5
(% of Net Sales)
16.6
18.6
17.1
18.6
18.9
18.9
Interest & other charges
-
-
-
-
-
-
Other Income
46.0
40.0
168.2
(270.8)
-
-
(% of PBT)
2.1
1.5
6.0
(10.0)
-
-
Share in profit of associates
10.4
17.4
19.5
22.9
22.9
22.9
Recurring PBT
2,237
2,661
2,816
2,714
3,414
3,894
% chg
14.7
19.0
5.9
-3.6
25.8
14.1
Extraordinary expense/(Inc.)
68.8
-
-
508.5
-
-
PBT (reported)
2,167.7
2,660.6
2,816.3
2,714.0
3,413.9
3,894.3
Tax
490.0
509.4
598.4
712.7
813.8
929.1
(% of PBT)
22.6
19.1
21.2
26.3
23.8
23.9
PAT (reported)
1,677.7
2,151.2
2,217.9
2,001.3
2,600.1
2,965.1
Add: Share of earnings of asso.
-
-
-
-
-
-
Less: Minority interest (MI)
-
-
-
-
-
-
Exceptional items
-
-
-
-
-
-
PAT after MI (reported)
1,677.7
2,151.2
2,217.9
2,001.3
2,600.1
2,965.1
ADJ. PAT
1,750.0
2,151.2
2,217.9
2,357.0
2,600.1
2,965.1
% chg
17.0
22.9
3.1
6.3
10.3
14.0
(% of Net Sales)
14.4
16.3
15.0
12.9
14.9
14.8
Basic EPS (`)
103.1
126.7
130.2
138.2
152.4
173.8
Fully Diluted EPS (`)
103.1
126.7
130.2
138.2
152.4
173.8
% chg
16.8
22.9
2.7
6.1
10.3
14.0
May 19, 2016
7
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Balance sheet (IFRS Consolidated)
Y/E March (` cr)
FY2013
FY2014
FY2015
FY2016
FY2017E FY2018E
SOURCES OF FUNDS
Equity share capital
84.9
84.9
85.2
85.3
85.3
85.3
Preference Capital
-
-
-
-
-
-
Reserves & surplus
7,224
8,995
11,045
12,748
14,949
17,515
Shareholders funds
7,309
9,080
11,130
12,834
15,034
17,600
Minority Interest
Total loans
3,676.0
4,474.2
3,954.3
3,661.9
3,661.9
3,661.9
Deferred tax liability
83.3
(192.9)
(401.3)
(423.0)
(423.0)
(423.0)
Total liabilities
11,068
13,361
14,683
16,073
18,273
20,839
APPLICATION OF FUNDS
Net fixed assets
3,781
3,945
4,314
5,396
6,596
7,796
Goodwill /other intangibles
1,402
1,470
1,643
1,969
1,969
1,969
Capital Work-in-Progress
495.2
495.2
495.2
495.2
495.2
495.2
Investments
1,764
2,589
3,811
3,833
3,833
3,833
Current Assets
6,875
7,866
8,558
8,465
10,087
12,149
Cash
513.6
845
539
492
660
1,358
Loans & Advances
697.6
793.0
889.1
928.2
1,048.8
1,201.3
Other
5,664
6,228
7,129
7,045
8,378
9,590
Current liabilities
3,252
3,006
4,214
4,193
4,813
5,510
Net Current Assets
3,623
4,860
4,344
4,273
5,273
6,639
Other Assets
-
76
106
106
106
Total Assets
11,068
13,361
14,683
16,073
18,273
20,839
May 19, 2016
8
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Cash flow statement (IFRS Consolidated)
Y/E March (` cr)
FY2013
FY2014
FY2015
FY2016
FY2017E FY2018E
Profit before tax
2,237
2,661
2,816
2,714
3,414
3,894
Depreciation
744
660
747
927
990
1,053
(Inc)/Dec in Working Capital
535
(906)
211
24
(833)
(668)
Less: Other income
46
40
168
(271)
-
-
Direct taxes paid
490
509
598
713
814
929
Cash Flow from Operations
2,980
1,865
3,008
3,224
2,758
3,350
(Inc.)/Dec.in Fixed Assets
(431)
(164)
(369)
(1,082)
(1,200)
(1,200)
(Inc.)/Dec. in Investments
687
824
1,222
22
-
-
Other income
46
40
168
(271)
-
-
Cash Flow from Investing
302
701
1,021
(1,331)
(1,200)
(1,200)
Issue of Equity
0
-
0
0
-
-
Inc./(Dec.) in loans
(1,155)
798
(520)
(292)
-
-
Dividend Paid (Incl. Tax)
298
358
399
399
399
399
Others
(2,649)
(3,390)
(4,214)
(2,047)
(1,789)
(1,851)
Cash Flow from Financing
(3,506)
(2,234)
(4,335)
(1,940)
(1,389)
(1,452)
Inc./(Dec.) in Cash
(224)
331
(306)
(47)
168
698
Opening Cash balances
738
514
845
539
492
660
Closing Cash balances
514
845
539
492
660
1,358
May 19, 2016
9
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Key ratios
Y/E March
FY2013
FY2014
FY2015
FY2016
FY2017E
FY2018E
Valuation Ratio (x)
P/E (on FDEPS)
29.3
23.8
23.2
21.8
19.8
17.3
P/CEPS
21.1
18.2
17.3
17.6
14.3
12.8
P/BV
7.0
5.6
4.6
4.0
3.4
2.9
Dividend yield (%)
0.5
0.5
0.5
0.5
0.5
0.5
EV/Sales
4.5
4.0
3.4
3.3
2.9
2.5
EV/EBITDA
19.7
16.7
15.5
13.4
11.8
10.3
EV / Total Assets
4.8
3.9
3.5
3.2
2.8
2.4
Per Share Data (`)
EPS (Basic)
103.1
126.7
130.2
138.2
152.4
173.8
EPS (fully diluted)
103.1
126.7
130.2
138.2
152.4
173.8
Cash EPS
142.6
165.5
174.0
171.7
210.4
235.5
DPS
15.0
15.0
15.0
15.0
15.0
15.0
Book Value
430.4
534.7
653.3
752.3
881.3
1,031.7
Dupont Analysis
EBIT margin
16.6
18.6
17.1
18.6
18.9
18.9
Tax retention ratio
77.4
80.9
78.8
73.7
76.2
76.1
Asset turnover (x)
1.2
1.2
1.1
1.0
1.1
1.1
ROIC (Post-tax)
14.9
17.4
15.1
14.3
15.2
15.6
Cost of Debt (Post Tax)
0.0
0.0
0.0
0.0
0.0
0.0
Leverage (x)
0.6
0.4
0.4
0.3
0.2
0.2
Operating ROE
23.5
24.7
20.4
18.3
18.6
18.2
Returns (%)
ROCE (Pre-tax)
17.8
20.2
18.1
18.7
19.2
19.3
Angel ROIC (Pre-tax)
23.1
25.6
22.5
22.9
23.4
23.5
ROE
26.8
26.3
21.9
19.7
18.7
18.2
Turnover ratios (x)
Asset Turnover (Gross Block)
3.3
3.5
3.6
3.2
2.9
2.8
Inventory / Sales (days)
63
62
61
60
61
64
Receivables (days)
88
89
90
96
88
93
Payables (days)
44
40
43
59
43
42
WC cycle (ex-cash) (days)
104
97
96
89
87
90
Solvency ratios (x)
Net debt to equity
0.4
0.4
0.3
0.2
0.2
0.1
Net debt to EBITDA
1.2
1.2
1.0
0.8
0.7
0.5
Interest Coverage (EBIT / Int.)
-
-
-
-
-
-
May 19, 2016
10
Dr. Reddy’s Laboratories | 4QFY2016 Result Update
Research Team Tel: 022 - 39357800
E-mail: [email protected]
Website: www.angelbroking.com
DISCLAIMER
Angel Broking Private Limited (hereinafter referred to as “Angel”) is a registered Member of National Stock Exchange of India Limited,
Bombay Stock Exchange Limited and Metropolitan Stock Exchange of India Limited. It is also registered as a Depository Participant with
CDSL and Portfolio Manager with SEBI. It also has registration with AMFI as a Mutual Fund Distributor. Angel Broking Private Limited is
a registered entity with SEBI for Research Analyst in terms of SEBI (Research Analyst) Regulations, 2014 vide registration number
INH000000164. Angel or its associates has not been debarred/ suspended by SEBI or any other regulatory authority for accessing
/dealing in securities Market. Angel or its associates including its relatives/analyst do not hold any financial interest/beneficial
ownership of more than 1% in the company covered by Analyst. Angel or its associates/analyst has not received any compensation /
managed or co-managed public offering of securities of the company covered by Analyst during the past twelve months. Angel/analyst
has not served as an officer, director or employee of company covered by Analyst and has not been engaged in market making activity
of the company covered by Analyst.
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment
decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should
make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the
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the merits and risks of such an investment.
Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and
trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's
fundamentals.
The information in this document has been printed on the basis of publicly available information, internal data and other reliable
sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this
document is for general guidance only. Angel Broking Pvt. Limited or any of its affiliates/ group companies shall not be in any way
responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report.
Angel Broking Pvt. Limited has not independently verified all the information contained within this document. Accordingly, we cannot
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Note: Please refer to the important ‘Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the
latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Pvt. Limited and its affiliates may
have investment positions in the stocks recommended in this report.
Disclosure of Interest Statement
Dr. Reddy’s Laboratories
1. Analyst ownership of the stock
No
2. Angel and its Group companies ownership of the stock
No
3. Angel and its Group companies' Directors ownership of the stock
No
4. Broking relationship with company covered
No
Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors
Ratings (Based on expected returns
Buy (> 15%)
Accumulate (5% to 15%)
Neutral (-5 to 5%)
over 12 months investment period):
Reduce (-5% to -15%)
Sell (< -15%)
May 19, 2016
11