Dr Reddys Laboratories Ltd

Dear shareholders,

At Dr. Reddy's, our unwavering focus has been to make affordable, innovative medicines accessible to all. Guided by our credo ‘Good Health Can't Wait'; we continue to address unmet patient needs, making expensive medicines affordable, improving disease management and ensuring availability.

FY2025 has been a pivotal year for Dr. Reddy's. We delivered double-digit top line growth with every market contributing - the U.S., Europe, Emerging Markets, India and PSAI. Our EBITDA margin stood at 28.3% and our ROCE reached ~28% for the full fiscal.

In the U.S., growth was steady and matched market pace, supported by new launches, Lenalidomide sales and a stable base business. India business growth of 8.4% vs IPM growth of 8.0% basis MAT 25 was led by Dermatology, Respiratory, Vaccine, Urology, Stomatologicals and Vitamins, Minerals & Nutrients (VMN) while few therapy areas like Gastrointestinal, Cardiac and Pain slowed. Other regions recorded double-digit growth from product launches and volume momentum.

We took a dual track approach this year:

y Strengthen our core - API, generics, branded generics, biosimilars and OTC

y Build new value pools by investing in future growth areas including consumer healthcare, biosimilars and novel molecules such as NCEs, NBEs and CAR-T

We expanded through acquisition and partnerships across key markets.

Nicotinell and other leading Nicotine Replacement Therapy (NRT) brands, expanding our footprint in Europe and beyond. This consumer healthcare category with a high entry barrier will drive steady returns.

Partnerships:

Leveraging on our distribution capabilities, we entered into a nutrition venture with Nestle in India, received U.S. rights for Cyclophosphamide from Ingenus and launched Galvus (anti-diabetes) in Russia.

We in-licensed Vonoprazan (GI drug from Takeda) and launched Toripalimab (immuno-oncology) and Elobixibat (chronic constipation treatment) in India. We expanded our alliance with Sanofi (BeyfortusR for Respiratory Syncytial Virus (RSV).

We partnered with Gilead Sciences to bring HIV drug Lenacapavir to low- and lower-middle-income nations.

We opened a cutting-edge biologics CDMO facility in Genome Valley. Our subsidiary Aurigene got US FDA IND approval for two promising oncology assets - AUR 110 for solid tumours and AUR112 for lymphoid malignancies. We secured Rituximab approval in Europe and filed Denosumab in the U.S. and Europe.

The above initiatives are in line with our strategy to address issues of availability and accessibility of affordable innovation through in-house and collaborative efforts.

We continue to prioritise R&D, investing in complex generics like peptides, biosimilars and novel oncology assets.

Our pipeline, with several first-to-market opportunities, positions us well for future growth.

We had positive quality inspections from multiple regulators. We continue to prioritise sustainable compliance across all our manufacturing units, further reinforcing our position as a trusted partner delivering high-quality medicines. We are actively engaging with USFDA to resolve pending matters and bring proposed rituximab biosimilar to patients in the U.S.

68% of our power is from renewables, we are 60% carbon neutral and continue to be water positive in operations. We were honoured with global recognitions for sustainability and corporate governance including upgrades from MSCI and S&P Global CSA.

y Time and Statista Global 500 - Most Sustainable Companies

y Financial Times - ‘Asia-Pacific Climate Leader'

y MSCI rating upgraded to 'A' y S&P Global ESG score improved to 79

y EcoVadis score improved to 73

Despite external challenges, our fundamentals are strong. Our people empowered by digital tools and data are building capabilities for the future. One of our key products in the U.S. will face increased competition beginning February 2026 with an anticipated decline in sales and profits. We have been preparing for this through FY2025 through a combination of organic and inorganic strategies. In FY2026, we will continue to grow and strengthen our core businesses, enhance value through portfolio management and strategic differentiation, scale our presence in consumer healthcare, innovative therapies & biosimilars, introduce new revenue streams via acquisitions and strategic partnerships, boost efficiency across the value chain and streamline structural costs to minimise the impact.

Thank you to our Board for strategic leadership, our team's relentless execution and you, our shareholders, for your unwavering trust and support. We look forward to continuing this journey with you.