Via Facsimile and U.S. Mail
Mail Stop 6010


February 2, 2006

Mr. V.S. Vasudevan
Chief Financial Officer
Dr. Reddy`s Laboratories Limited
7-1-27, Amerpeet
Hyderabad, Andhra Pradesh 500 016
India

      Re:	Dr. Reddy`s Laboratories Limited
		Form 20-F for Fiscal Year Ended March 31, 2005
		File No. 001-15182

Dear Mr. Vasudevan:

	We have limited our review of your filing to those issues we
have addressed in our comments.  In our comments, we ask you to
provide us with information so we may better understand your
disclosure.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

Form 20-F for the Fiscal Year Ended March 31, 2005

General

1. We reference the comment letter issued to you by our Office of
Global Security Risk on September 30, 2005 regarding certain
business
interests and contracts in countries that have been identified as
state sponsors of terrorism and note that you have not yet
responded
to those comments. We request that you respond to the comments
issued
in that letter under separate cover.

Management`s Discussion and Analysis of Financial Condition and
Results of Operations

Critical Accounting Policies

Accounting Estimates, page 49

2. We acknowledge your revenue recognition policy as noted herein
and
within your "Summary of Significant Accounting Policies" in the
accompanying notes to your consolidated financial statements. We
believe that your disclosure related to estimates of items that
reduce your gross revenue, namely sales returns, could be defined
and
improved.  Please provide us with the following information in a
disclosure-type format:

a).	The effect that could result from using assumptions that are
reasonably likely to occur to estimate sales returns other than
those
upon which your current recorded estimate is based.  For example,
please provide a range of reasonably likely amounts or another
type
of sensitivity analysis.

b).	Factors, other than historical trends, that you utilize to
estimate your sales returns accrual, such as levels of inventory
in
the distribution channels; estimated remaining product shelf life;
price changes from competitors and introductions of new or generic
competing products.

c).	To the extent that the information you consider in b. is
quantifiable, discuss both quantitative and qualitative factors
and
the extent of availability and your use of information from
external
sources; for example, end-customer demand data compared to
inventory
levels.  In discussing your estimate of product returns, provide
additional information regarding the total amount of product in
sales
dollars that could potentially be returned as of the most recent
balance sheet date, disaggregated by expiration period.

e).	We note your presentation, in Note 22, of the roll-forwards
of
your sales returns allowance for the financial statement periods
presented. Please supplement those roll-forwards with the
following:

* current provision related to sales made in current period;
* current provision related to sales made in prior periods;
* actual returns or credits in current period related to sales
made
in current period; and
* actual returns or credits in current period related to sales
made
in prior periods.

f).	Finally, include information regarding the amount of and
reason
for period to period fluctuations within your statement of
operations
with respect to your sales returns allowance. Please address the
effect that changes in your estimates with respect to your sales
returns allowance had on your revenues and operations for the
applicable periods.

Revenue Recognition, page 50

3. We note that you recognize amounts related to non-refundable
up-
front license fees over the development period associated with the
underlying agreements, in proportion to the milestones earned
under
those agreements. Please provide us with additional information
that
supports this treatment, in particular with respect to the
Novartis
agreement, as it seems that you do not recognize revenue in
correlation with services performed under the license agreements.
Please consider and reference the applicable provisions of SAB No.
104, Topic 13A, in your response.
Notes to Consolidated Financial Statements

13. Investment in Affiliates, page F-23

4. Please provide us with your analysis according to the
provisions
of FIN 46R, particularly paragraph 5, in order to clarify your
determination that you do not need to consolidate Kunsham Rotam
Reddy
Pharmaceuticals Co. Ltd.

16. Research and Development Arrangement, page F-26

5. We note that you received an up-front payment of Rs. 985.4
million
($22.5 million U.S.) pursuant to your joint development and
commercialization agreement with I-VEN Pharma Capital Limited and
that you recognized Rs. 96.2 million ($2.2 million U.S.) of that
up-
front payment as a credit to research and development expense for
the
period ended March 31, 2005. Please provide us with additional
information, in a disclosure-type format, that supports your
accounting treatment related to this up-front payment; in
particular
the reason  you did not defer it and recognize it as revenue over
the
period you are committed to perform research and development.
Please
reference the applicable authoritative literature.

23. Other (Expense)/Income, Net, page F-33

6. We note that you recorded the loss of Rs. 58.4 million related
to
your sale of 51% of your formerly wholly owned interest in Compact
Electric Limited in "other income" in the statement of operations
for
the year ended March 31, 2004. Please provide us with additional
information that supports your accounting treatment of presenting
the
amount outside of operating income/loss and address your
consideration of SFAS No. 144, particularly paragraph 45.  In
addition, please clarify to us what is included in the "other"
line
item and why it is appropriate to include it outside of operating
income/loss.  Clarify the reasons for the differences between the
presentation of operating income/loss in the annual report to
shareholders and the presentation in your Form 20-F.

*    *    *    *

      Please provide us the information requested within 10
business
days of the date of this letter or tell us when you will provide a
response prior to the expiration of the 10-day period. Please
furnish
a letter with your responses that keys your responses to our
comments. Detailed letters greatly facilitate our review.  You
should
file the letter on EDGAR under the form type label CORRESP.
Please
understand that we may have additional comments after reviewing
your
responses to our comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that they
have
provided all information required under the Securities Exchange
Act
of 1934 and that they have provided all information investors
require
for an informed investment decision.  Since the company and its
management are in possession of all facts relating to a company`s
disclosure, they are responsible for the accuracy and adequacy of
the
disclosures they have made.

	In connection with responding to our comments, please
provide,
in your letter, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

       In addition, please be advised that the Division of
Enforcement has access to all information you provide to the staff
of
the Division of Corporation Finance in our review of your filing
or
in response to our comments on your filing.






      You may contact Amy Bruckner, Staff Accountant, at (202)
551-
3657 or Mary Mast, Senior Accountant, at (202) 551-3613 if you
have
questions regarding comments on the financial statements and
related
matters.  In this regard, please do not hesitate to contact me at
(202) 551-3679.


            Sincerely,


								Jim B. Rosenberg
							Senior Assistant Chief
Accountant
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Mr. V.S. Vasudevan
Dr. Reddy's Laboratories Limited
February 2, 2006
Page 5