UPDATE 2-India Dr Reddy's Q2 net doubles, keeps FY10 f'cast

* Net profit 2.17 bln rupees vs 1.05 bln year ago

* CEO says will not comment on Glaxo stake buy reports

* Maintains FY2009/10 revenue growth target of 10 percent

* Sales in German unit Betapharm falls on price pressure

* Shares end 6.2 percent higher in flat Mumbai market (Adds CEO comments, byline, updates share price)

By Sumeet Chatterjee

BANGALORE, Oct 23 (Reuters) - Dr Reddy's Laboratories (REDY.BO), India's second-largest drug maker by sales, beats forecasts by more than doubling quarterly net profit and maintained its full-year forecast on the launch of new generics, sending its shares up more than 6 percent.

Chief Executive G.V. Prasad declined to comment on reports that U.K.-based GlaxoSmithKline (GSK.L) has emerged as the frontrunner for a phased buy in the drugmaker. [ID:nBOM410702]

"We cannot comment on speculative news," Prasad told Reuters.

Global demand for generic drugs from drugmakers such as Dr Reddy's and domestic rivals Ranbaxy Laboratories (RANB.BO) and Cipla Ltd (CIPL.BO) is booming as nations battle rising healthcare costs.

The Indian generics business boom has lured Western drug makers which want to raise exposure in fast-growing emerging markets where a burgeoning middle class wants the assurance of cheap, safe drugs.

Prasad said Dr Reddy's was on track to achieve its forecast of 10 percent revenue growth in the year to March 2010, as it launched new products in its key markets that include the United States, Russia, Europe and India.

"The outlook is good," he said. "If you look at our pipeline, we plan to have one or two interesting launches every year."

The new launches in the current fiscal year will include blockbuster omeprazole, which the company plans to sell in the United States by next month, Prasad said.

Omeprazole is a generic version of AstraZeneca's (AZN.L) Prilosec, used for the treatment of stomach ulcers and acid reflux. Dr Reddy's will be the second generics maker after Perrigo (PRGO.O) to sell the copycat variant of this drug.

Last year Dr Reddy's launched acute migraine drug sumatriptan, a generic of GlaxoSmithKline's (GSK.L) Imitrex, in the U.S. market.

Shares in Hyderabad-based Dr Reddy's, which the market values at $3.3 billion, ended up 6.2 percent at 960.20 rupees, having risen as much as 6.7 percent on the day in the main Mumbai market .BSESN that closed 0.1 percent higher.

GERMAN CHALLENGES TO CONTINUE

The New York-listed company (RDY.N) reported a net profit of 2.17 billion rupees ($47 million) in July-September, its fiscal second quarter, compared with 1.05 billion rupees posted a year ago, under international accounting standards.

A Reuters survey of eight brokerages forecast average net profit at 1.96 billion rupees.

Under Indian accounting standards, quarterly net profit was 2.4 billion rupees.

Dr Reddy's said its U.S. revenues grew 39 percent in the quarter ended September to 4.3 billion rupees, while European sales dropped 15 percent to 2.8 billion rupees weighed down by its German subsidiary Betapharm. ($1=46.5 rupees) (Additional reporting by Janaki Krishnan; Editing by Malini Menon and David Cowell)