She desperately wants a new dress.

Literal

She [topic-は] new dress [object-を] terribly is-showing-desire-for.

ひどく ('terribly, intensely') amplifies 欲しがる to express strong desire. ひどく literally means 'severely' or 'horribly,' but as an intensifier it functions like 'terribly' or 'desperately' in English — the negative literal meaning fades into pure emphasis.