Dr Reddy’s Charts Sharp Cost Overhaul Amid Weak Q1
Dr Reddy’s plans a significant review of its “cost structure”, including potential portfolio rationalization and R&D site optimization, as part of broader efforts to emerge “leaner and agile” as it grapples with multiple business challenges that saw it post disappointing first quarter earnings.
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Dr Reddy’s Laboratories appears to be the among the Indian firms considering increasing its activities in China, enthused by the evolving regulatory environment and consequent market opportunities there. The Indian company believes a large basket of products could meet China’s new norms.
Dr Reddy’s quest to emerge as an “internationally cost-competitive and more nimble organization” is expected to entail further rationalization of the firm’s manufacturing network. The company may put on the block a formulations site in India, if the buzz on deal street is to be believed.
Dr Reddy’s Laboratories has set in motion significant cost control initiatives as part of broader efforts to emerge leaner and more nimble. Headcount rationalization in R&D is rumored to be already underway, while more operational areas could potentially see significant manpower reductions.