A few weeks ago, we wrote that we believed there was some upside in Dr. Reddy’s Laboratories Ltd (RDY), an India-based generic drug manufactuer (see Dr. Reddy’s vs. the World). We also warned that there were many outstanding lawsuits for IP infringement, and that the stock was “not exactly cheap.” Now Dr. Reddy’s has had a very bad quarter, with its net profits falling an astonishing 74%. Shares dropped eight percent on the announcement, but have recently regained most of that loss. This is probably as a result of prior strong performance and continued upside potential, although that potential will likely take much longer to come to fruition.
