Tax cuts into Dr Reddy's profit again in 2nd qtr

Indian generics major Dr Reddy's Laboratories net profit continued to drop, falling 52% in the second quarter of its fiscal 2009, compared to the same period of the financial year before, despite a 30% increase in revenue, due to rocketing income tax expenses.

Sales rose to $348.0 million versus $268.0 million. R&D costs were almost flat at $18.0 million vs $17.0 million. This brought the Hyderabad-headquartered company's profit before tax to $33.0 million vs $31.0 million.

However, the firm posted a $7.0-million income tax expense vs a $24.0-million income tax gain, bringing overall net profit to $26.0 million, or $0.20 per share, vs $54.0 million, or $0.30 per share. During the period, the firm increased its cash and cash equivalent assests by 38% to $110.0 million.