DR. REDDY'S LABORATORIES-ADR (RDY) Stock Fundamental Analysis
NYSE:RDY • US2561352038
14.305 USD
-0.12 (-0.8%)
Last: Feb 19, 2026, 10:29 AM
Taking everything into account, RDY scores 6 out of 10 in our fundamental rating. RDY was compared to 191 industry peers in the Pharmaceuticals industry. While RDY has a great profitability rating, there are some minor concerns on its financial health. RDY has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- RDY had positive earnings in the past year.
- In the past year RDY had a positive cash flow from operations.
- In the past 5 years RDY has always been profitable.
- Each year in the past 5 years RDY had a positive operating cash flow.
1.2 Ratios
- With an excellent Return On Assets value of 10.62%, RDY belongs to the best of the industry, outperforming 91.62% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 16.03%, RDY belongs to the top of the industry, outperforming 88.48% of the companies in the same industry.
- RDY's Return On Invested Capital of 13.03% is amongst the best of the industry. RDY outperforms 91.62% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for RDY is above the industry average of 12.64%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.62% | ||
| ROE | 16.03% | ||
| ROIC | 13.03% |
ROA(3y)13.25%
ROA(5y)10.88%
ROE(3y)18.65%
ROE(5y)15.68%
ROIC(3y)15.26%
ROIC(5y)13.95%
1.3 Margins
- Looking at the Profit Margin, with a value of 16.82%, RDY belongs to the top of the industry, outperforming 88.48% of the companies in the same industry.
- In the last couple of years the Profit Margin of RDY has grown nicely.
- RDY's Operating Margin of 19.62% is amongst the best of the industry. RDY outperforms 86.91% of its industry peers.
- In the last couple of years the Operating Margin of RDY has grown nicely.
- With a decent Gross Margin value of 66.88%, RDY is doing good in the industry, outperforming 75.92% of the companies in the same industry.
- In the last couple of years the Gross Margin of RDY has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.62% | ||
| PM (TTM) | 16.82% | ||
| GM | 66.88% |
OM growth 3Y9.42%
OM growth 5Y4.7%
PM growth 3Y19.59%
PM growth 5Y8.42%
GM growth 3Y2.12%
GM growth 5Y0.39%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RDY is creating some value.
- The number of shares outstanding for RDY remains at a similar level compared to 1 year ago.
- The number of shares outstanding for RDY has been increased compared to 5 years ago.
- RDY has a worse debt/assets ratio than last year.
2.2 Solvency
- RDY has an Altman-Z score of 5.81. This indicates that RDY is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 5.81, RDY is in the better half of the industry, outperforming 78.53% of the companies in the same industry.
- The Debt to FCF ratio of RDY is 3.17, which is a good value as it means it would take RDY, 3.17 years of fcf income to pay off all of its debts.
- RDY has a Debt to FCF ratio of 3.17. This is amongst the best in the industry. RDY outperforms 89.53% of its industry peers.
- RDY has a Debt/Equity ratio of 0.03. This is a healthy value indicating a solid balance between debt and equity.
- RDY's Debt to Equity ratio of 0.03 is in line compared to the rest of the industry. RDY outperforms 53.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 5.81 |
ROIC/WACC1.27
WACC10.26%
2.3 Liquidity
- RDY has a Current Ratio of 1.85. This is a normal value and indicates that RDY is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.85, RDY is doing worse than 64.40% of the companies in the same industry.
- A Quick Ratio of 1.35 indicates that RDY should not have too much problems paying its short term obligations.
- With a Quick ratio value of 1.35, RDY is not doing good in the industry: 67.54% of the companies in the same industry are doing better.
- RDY does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
- The Earnings Per Share has been growing slightly by 3.81% over the past year.
- Measured over the past years, RDY shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.62% on average per year.
- Looking at the last year, RDY shows a quite strong growth in Revenue. The Revenue has grown by 11.06% in the last year.
- Measured over the past years, RDY shows a quite strong growth in Revenue. The Revenue has been growing by 13.26% on average per year.
EPS 1Y (TTM)3.81%
EPS 3Y33.55%
EPS 5Y23.62%
EPS Q2Q%-14.29%
Revenue 1Y (TTM)11.06%
Revenue growth 3Y14.86%
Revenue growth 5Y13.26%
Sales Q2Q%4.44%
3.2 Future
- Based on estimates for the next years, RDY will show a decrease in Earnings Per Share. The EPS will decrease by -1.42% on average per year.
- The Revenue is expected to grow by 6.32% on average over the next years.
EPS Next Y-6.34%
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
EPS Next 5YN/A
Revenue Next Year5.1%
Revenue Next 2Y3.83%
Revenue Next 3Y5.5%
Revenue Next 5Y6.32%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.33, RDY is valued on the expensive side.
- Based on the Price/Earnings ratio, RDY is valued cheaper than 83.77% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.27. RDY is valued slightly cheaper when compared to this.
- The Price/Forward Earnings ratio is 22.68, which indicates a rather expensive current valuation of RDY.
- Based on the Price/Forward Earnings ratio, RDY is valued a bit cheaper than 75.39% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of RDY to the average of the S&P500 Index (28.16), we can say RDY is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.33 | ||
| Fwd PE | 22.68 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, RDY is valued cheaper than 86.39% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of RDY indicates a somewhat cheap valuation: RDY is cheaper than 76.96% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 58.47 | ||
| EV/EBITDA | 11.68 |
4.3 Compensation for Growth
- The excellent profitability rating of RDY may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.82
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.50%, RDY is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 1.18, RDY pays a better dividend. On top of this RDY pays more dividend than 89.01% of the companies listed in the same industry.
- With a Dividend Yield of 0.50, RDY pays less dividend than the S&P500 average, which is at 1.85.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
5.2 History
- The dividend of RDY decreases each year by -19.44%.
- RDY has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-19.44%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- RDY pays out 11.54% of its income as dividend. This is a sustainable payout ratio.
- The Dividend Rate of RDY has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP11.54%
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
NYSE:RDY (2/19/2026, 10:29:02 AM)
14.305
-0.12 (-0.8%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)01-21 2026-01-21/amc
Earnings (Next)05-07 2026-05-07/amc
Inst Owners49.42%
Inst Owner Change-0.18%
Ins Owners1.23%
Ins Owner ChangeN/A
Market Cap11.91B
Revenue(TTM)346.82B
Net Income(TTM)57.72B
Analysts67.27
Price Target15.63 (9.26%)
Short Float %2.13%
Short Ratio8.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
Yearly Dividend0.09
Dividend Growth(5Y)-19.44%
DP11.54%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-7.63%
Min EPS beat(2)-8.52%
Max EPS beat(2)-6.74%
EPS beat(4)1
Avg EPS beat(4)-3.93%
Min EPS beat(4)-8.52%
Max EPS beat(4)2.77%
EPS beat(8)4
Avg EPS beat(8)-0.94%
EPS beat(12)8
Avg EPS beat(12)6.66%
EPS beat(16)10
Avg EPS beat(16)7.01%
Revenue beat(2)0
Avg Revenue beat(2)-2.69%
Min Revenue beat(2)-3.88%
Max Revenue beat(2)-1.51%
Revenue beat(4)1
Avg Revenue beat(4)-1.2%
Min Revenue beat(4)-3.88%
Max Revenue beat(4)1%
Revenue beat(8)4
Avg Revenue beat(8)0.25%
Revenue beat(12)7
Avg Revenue beat(12)1.24%
Revenue beat(16)9
Avg Revenue beat(16)1.2%
PT rev (1m)4.76%
PT rev (3m)3.93%
EPS NQ rev (1m)-3.66%
EPS NQ rev (3m)-3.66%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)-0.74%
Revenue NQ rev (1m)-1.38%
Revenue NQ rev (3m)-1.38%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.33 | ||
| Fwd PE | 22.68 | ||
| P/S | 3.15 | ||
| P/FCF | 58.47 | ||
| P/OCF | 18.36 | ||
| P/B | 3 | ||
| P/tB | 4.41 | ||
| EV/EBITDA | 11.68 |
EPS(TTM)0.74
EY5.17%
EPS(NY)0.63
Fwd EY4.41%
FCF(TTM)0.24
FCFY1.71%
OCF(TTM)0.78
OCFY5.45%
SpS4.54
BVpS4.77
TBVpS3.25
PEG (NY)N/A
PEG (5Y)0.82
Graham Number8.91
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.62% | ||
| ROE | 16.03% | ||
| ROCE | 17.14% | ||
| ROIC | 13.03% | ||
| ROICexc | 16.05% | ||
| ROICexgc | 25.11% | ||
| OM | 19.62% | ||
| PM (TTM) | 16.82% | ||
| GM | 66.88% | ||
| FCFM | 5.38% |
ROA(3y)13.25%
ROA(5y)10.88%
ROE(3y)18.65%
ROE(5y)15.68%
ROIC(3y)15.26%
ROIC(5y)13.95%
ROICexc(3y)19.62%
ROICexc(5y)17.62%
ROICexgc(3y)25.36%
ROICexgc(5y)22.59%
ROCE(3y)21.22%
ROCE(5y)19.86%
ROICexgc growth 3Y6.58%
ROICexgc growth 5Y2.58%
ROICexc growth 3Y0.6%
ROICexc growth 5Y-0.12%
OM growth 3Y9.42%
OM growth 5Y4.7%
PM growth 3Y19.59%
PM growth 5Y8.42%
GM growth 3Y2.12%
GM growth 5Y0.39%
F-Score4
Asset Turnover0.63
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 3.17 | ||
| Debt/EBITDA | 0.13 | ||
| Cap/Depr | 211.61% | ||
| Cap/Sales | 11.76% | ||
| Interest Coverage | 16.55 | ||
| Cash Conversion | 68.09% | ||
| Profit Quality | 32% | ||
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.35 | ||
| Altman-Z | 5.81 |
F-Score4
WACC10.26%
ROIC/WACC1.27
Cap/Depr(3y)179.81%
Cap/Depr(5y)161.03%
Cap/Sales(3y)9.33%
Cap/Sales(5y)8.68%
Profit Quality(3y)47.43%
Profit Quality(5y)60.48%
High Growth Momentum
Growth
EPS 1Y (TTM)3.81%
EPS 3Y33.55%
EPS 5Y23.62%
EPS Q2Q%-14.29%
EPS Next Y-6.34%
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
EPS Next 5YN/A
Revenue 1Y (TTM)11.06%
Revenue growth 3Y14.86%
Revenue growth 5Y13.26%
Sales Q2Q%4.44%
Revenue Next Year5.1%
Revenue Next 2Y3.83%
Revenue Next 3Y5.5%
Revenue Next 5Y6.32%
EBIT growth 1Y1.53%
EBIT growth 3Y25.68%
EBIT growth 5Y18.58%
EBIT Next Year13.87%
EBIT Next 3Y6.33%
EBIT Next 5Y9.08%
FCF growth 1Y-62.42%
FCF growth 3Y9.92%
FCF growth 5Y-12.7%
OCF growth 1Y-18.43%
OCF growth 3Y18.21%
OCF growth 5Y9.24%
DR. REDDY'S LABORATORIES-ADR / RDY FAQ
What is the ChartMill fundamental rating of DR. REDDY'S LABORATORIES-ADR (RDY) stock?
ChartMill assigns a fundamental rating of 6 / 10 to RDY.
What is the valuation status of DR. REDDY'S LABORATORIES-ADR (RDY) stock?
ChartMill assigns a valuation rating of 5 / 10 to DR. REDDY'S LABORATORIES-ADR (RDY). This can be considered as Fairly Valued.
What is the profitability of RDY stock?
DR. REDDY'S LABORATORIES-ADR (RDY) has a profitability rating of 8 / 10.
Can you provide the expected EPS growth for RDY stock?
The Earnings per Share (EPS) of DR. REDDY'S LABORATORIES-ADR (RDY) is expected to decline by -6.34% in the next year.
Is the dividend of DR. REDDY'S LABORATORIES-ADR sustainable?
The dividend rating of DR. REDDY'S LABORATORIES-ADR (RDY) is 4 / 10 and the dividend payout ratio is 11.54%.