DRL's revenues decreased by 14.0% YoY to Rs 32.3 bn (lower than our estimates of Rs 37.9 bn) due to tepid performance across Generics and PSAI. Gross margins decreased by 486bps YoY to 56.2% in Q1FY17 (lower than our estimates of 56.6%) due to greater price erosion in key products. Its operating profit has tanked to Rs 3869 mn during the quarter due decline in revenues, higher SGA including remediation costs and R & D expenses. Net profit de-grew by 79.8% YoY to Rs 1.26 bn (lower than our estimates of Rs 4.8 bn).