DR. REDDY'S LABORATORIES-ADR (RDY) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RDY - US2561352038 - ADR
14.19 USD
+0.05 (+0.35%)
14.19 USD
0 (0%)
Overall RDY gets a fundamental rating of 6 out of 10. We evaluated RDY against 192 industry peers in the Pharmaceuticals industry. RDY scores excellent on profitability, but there are some minor concerns on its financial health. RDY is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
RDY had positive earnings in the past year.
RDY had a positive operating cash flow in the past year.
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
RDY has a Return On Assets of 10.62%. This is amongst the best in the industry. RDY outperforms 92.19% of its industry peers.
RDY's Return On Equity of 16.03% is amongst the best of the industry. RDY outperforms 89.58% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.03%, RDY belongs to the top of the industry, outperforming 92.19% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for RDY is above the industry average of 12.71%.
| 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
With an excellent Profit Margin value of 16.82%, RDY belongs to the best of the industry, outperforming 89.58% of the companies in the same industry.
RDY's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 19.62%, RDY belongs to the top of the industry, outperforming 86.46% of the companies in the same industry.
In the last couple of years the Operating Margin of RDY has grown nicely.
The Gross Margin of RDY (66.88%) is better than 75.00% of its industry peers.
RDY's Gross Margin has been stable in the last couple of years.
| 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.
Compared to 1 year ago, RDY has about the same amount of shares outstanding.
RDY has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, RDY has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 5.71 indicates that RDY is not in any danger for bankruptcy at the moment.
The Altman-Z score of RDY (5.71) is better than 76.56% of its industry peers.
RDY has a debt to FCF ratio of 3.17. This is a good value and a sign of high solvency as RDY would need 3.17 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.17, RDY belongs to the top of the industry, outperforming 88.54% of the companies in the same industry.
RDY has a Debt/Equity ratio of 0.03. This is a healthy value indicating a solid balance between debt and equity.
RDY has a Debt to Equity ratio (0.03) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 5.71 |
ROIC/WACC1.27
WACC10.23%
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.
RDY's Current ratio of 1.85 is on the low side compared to the rest of the industry. RDY is outperformed by 63.54% of its industry peers.
A Quick Ratio of 1.35 indicates that RDY should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.35, RDY is doing worse than 67.71% of the companies in the same industry.
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
RDY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.21%, which is quite good.
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.
RDY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.04%.
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)8.21%
EPS 3Y33.55%
EPS 5Y23.62%
EPS Q2Q%7.44%
Revenue 1Y (TTM)14.04%
Revenue growth 3Y14.86%
Revenue growth 5Y13.26%
Sales Q2Q%9.83%
3.2 Future
Based on estimates for the next years, RDY will show a decrease in Earnings Per Share. The EPS will decrease by -0.50% on average per year.
RDY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.48% yearly.
EPS Next Y-5.63%
EPS Next 2Y-8.15%
EPS Next 3Y-0.5%
EPS Next 5YN/A
Revenue Next Year5.28%
Revenue Next 2Y3.93%
Revenue Next 3Y6.3%
Revenue Next 5Y6.48%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 18.43, RDY is valued on the expensive side.
Based on the Price/Earnings ratio, RDY is valued cheaper than 83.33% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.46. RDY is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 22.29 indicates a rather expensive valuation of RDY.
RDY's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. RDY is cheaper than 75.52% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 36.10. RDY is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.43 | ||
| Fwd PE | 22.29 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RDY is valued cheaply inside the industry as 85.42% of the companies are valued more expensively.
76.04% of the companies in the same industry are more expensive than RDY, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 57.48 | ||
| EV/EBITDA | 11.33 |
4.3 Compensation for Growth
The excellent profitability rating of RDY may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.78
EPS Next 2Y-8.15%
EPS Next 3Y-0.5%
5. Dividend
5.1 Amount
RDY has a yearly dividend return of 0.63%, which is pretty low.
Compared to an average industry Dividend Yield of 6.46, RDY pays a better dividend. On top of this RDY pays more dividend than 90.10% of the companies listed in the same industry.
With a Dividend Yield of 0.63, RDY pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
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
11.54% of the earnings are spent on dividend by RDY. This is a low number and 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-8.15%
EPS Next 3Y-0.5%
14.19
+0.05 (+0.35%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners51.65%
Inst Owner Change-1.5%
Ins Owners21.86%
Ins Owner ChangeN/A
Market Cap11.81B
Revenue(TTM)343.10B
Net Income(TTM)57.72B
Analysts57.33
Price Target14.87 (4.79%)
Short Float %1.37%
Short Ratio7.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
Yearly Dividend0.09
Dividend Growth(5Y)-19.44%
DP11.54%
Div Incr Years0
Div Non Decr Years0
Ex-Date
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)-1.42%
PT rev (3m)-0.37%
EPS NQ rev (1m)-0.02%
EPS NQ rev (3m)-3.06%
EPS NY rev (1m)-4%
EPS NY rev (3m)-3.86%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.24%
Revenue NY rev (1m)-0.97%
Revenue NY rev (3m)-0.96%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.43 | ||
| Fwd PE | 22.29 | ||
| P/S | 3.09 | ||
| P/FCF | 57.48 | ||
| P/OCF | 18.05 | ||
| P/B | 2.95 | ||
| P/tB | 4.33 | ||
| EV/EBITDA | 11.33 |
EPS(TTM)0.77
EY5.43%
EPS(NY)0.64
Fwd EY4.49%
FCF(TTM)0.25
FCFY1.74%
OCF(TTM)0.79
OCFY5.54%
SpS4.59
BVpS4.81
TBVpS3.28
PEG (NY)N/A
PEG (5Y)0.78
Graham Number9.13
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 | 5.71 |
F-Score4
WACC10.23%
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)8.21%
EPS 3Y33.55%
EPS 5Y23.62%
EPS Q2Q%7.44%
EPS Next Y-5.63%
EPS Next 2Y-8.15%
EPS Next 3Y-0.5%
EPS Next 5YN/A
Revenue 1Y (TTM)14.04%
Revenue growth 3Y14.86%
Revenue growth 5Y13.26%
Sales Q2Q%9.83%
Revenue Next Year5.28%
Revenue Next 2Y3.93%
Revenue Next 3Y6.3%
Revenue Next 5Y6.48%
EBIT growth 1Y1.53%
EBIT growth 3Y25.68%
EBIT growth 5Y18.58%
EBIT Next Year18.8%
EBIT Next 3Y6.64%
EBIT Next 5Y9.17%
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.
Can you provide the valuation status for DR. REDDY'S LABORATORIES-ADR?
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 PE and PB ratios for RDY stock?
The Price/Earnings (PE) ratio for DR. REDDY'S LABORATORIES-ADR (RDY) is 18.43 and the Price/Book (PB) ratio is 2.95.
How financially healthy is DR. REDDY'S LABORATORIES-ADR?
The financial health rating of DR. REDDY'S LABORATORIES-ADR (RDY) is 6 / 10.