Dr.Reddy’s Labs, announced its earnings for Q4Fy22 just now and looks like the impairment losses it took on has hit the bottomline.

Consolidated Net profit came in at Rs.88 crore, down 76% (YoY) as against widely expected net profit of around Rs.650 crore. This was thanks to the Rs.751.5 crore the company charged towards impairment losses on non-current assets due to significant changes in market conditions. These relate to product impairment of a tablet on account of a decrease in market potential and impairment relating to Shreveport plant assets and goodwill and other intangibles.

But for this, net profit would have actually come in at Rs.839.50 crore, much higher than estimates. And that probably explains why the stock is in the green despite the fall in net profit. The stock opened lower at Rs.3850 but by mid-afternoon climbed up to Rs.4014.20 but profit booking came in and is now trading at Rs.3930, around 1% higher. Volumes are up over 12-times.

On the other earnings parameter, its revenue rose 15% (YoY) at Rs.5475. EBITDA came in at Rs.1193 crore, up 13%.

In terms of geography, revenue in North America rose 14%, India by 15%, Europe by 12% and the best performing region was Emerging Markets at 36%.