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    Shyam Srinivasan • Goldman Sachs

    Shyam Srinivasan's questions to Dr Reddy's Laboratories Ltd (RDY) leadership

    Shyam Srinivasan's questions to Dr Reddy's Laboratories Ltd (RDY) leadership • Q1 2026

    Question

    Shyam Srinivasan of Goldman Sachs inquired about the full-year CapEx outlook, plans for deploying the company's cash surplus, and the strategy for sustaining growth in the India business.

    Answer

    CFO M V Narasimham guided for full-year CapEx of ₹2,100-2,700 crores, similar to last year, with investments focused on peptides and biosimilars. CEO Erez Israeli added that the company has $2-2.5 billion in financial capacity (including debt) for business development and is actively pursuing opportunities. For the India business, he stated growth will be driven by launching innovative products through in-licensing, rather than focusing on branded generics, to consistently outpace the market and achieve double-digit growth.

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    Shyam Srinivasan's questions to Dr Reddy's Laboratories Ltd (RDY) leadership • Q1 2025

    Question

    Shyam Srinivasan of Goldman Sachs asked about the company's capital allocation strategy given its significant cash balance and strong cash flow, specifically focusing on investment priorities and its M&A philosophy for the Indian market amid high valuations.

    Answer

    CEO Erez Israeli stated the company has about $2.5 billion in inorganic investment capacity and will focus on collaborations and licensing across its four key areas: B2B generics, innovation, consumer care, and biologics. Regarding India, he affirmed it remains a priority market but emphasized that the company will not pursue deals where the cost of capital exceeds the potential return, avoiding overpaying for EBITDA in the current high-interest environment.

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