Dr Reddy's Receives Approval for Semaglutide in Canada, Stocks Decline Amid Cautious Brokerage Outlooks

Dr Reddy's Laboratories Shares Slip on Brokerage Cautiousness

Shares of Dr Reddy's Laboratories declined in Friday's trade after brokerages turned cautious on the stock following recent gains linked to hopes around semaglutide approval in Canada.

As per the latest data from the National Stock Exchange (NSE), Dr Reddy's Laboratories Limited shares were trading at Rs 1,316, down Rs 15 or 1.13% from the previous day.

Citi, a leading brokerage firm, maintained a 'Sell' rating on Dr Reddy's with a target price of Rs 1,070 per share. The brokerage firm said that the company's recent 9% rally on unconfirmed generic semaglutide approval news in Canada likely overstated the upside.

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Citi maintained its FY28 revenue estimate of $50 million in a six-player market, while estimating FY27 revenue of $80-100 million in a three-player market with a 65% generic discount. It added that upside to $150-180 million appears unlikely due to competition and possible price cuts. Citi also warned that the ex-Revlimid impact in Q4FY26 could lead to earnings estimate cuts.

Similarly, Goldman Sachs downgraded Dr Reddy's to 'Sell' from Neutral and set a target price of Rs 1,075 per share. The brokerage firm said that even if approval comes through, the Ozempic opportunity in Canada may be short-lived because of faster competition. Goldman Sachs added that the company's near-term pipeline remains limited to Ozempic and the Abatacept biosimilar, while ongoing price erosion in base products remains a concern. It also cut FY26-28 EPS estimates by 8-26% on slower growth and the Ozempic impact.

In a separate filing, Dr Reddy's Laboratories addressed CNBC-TV18's report titled, "Dr Reddy's Laboratories still awaiting approval for a major near-term trigger, sources say." The company stated that the report was correct, as they have not yet received approval ('Notice of Compliance') for their Semaglutide Injection from Health Canada.

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However, the company did receive the 'Drug Identification Numbers (DINs)' for Semaglutide Injection from Health Canada on April 22, 2026. Dr Reddy's also stated that they continue to engage constructively with the regulatory authority and remain committed to bringing the product to the Canadian market upon approval.