DR. REDDY'S LABORATORIES-ADR (RDY) Stock Fundamental Analysis
NYSE:RDY • US2561352038
14.38 USD
-0.2 (-1.37%)
At close: Feb 27, 2026
14.38 USD
0 (0%)
After Hours: 2/27/2026, 8:04:00 PM
Taking everything into account, RDY scores 6 out of 10 in our fundamental rating. RDY was compared to 193 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 correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year RDY was profitable.
- In the past year RDY had a positive cash flow from operations.
- Each year in the past 5 years RDY has been profitable.
- In the past 5 years RDY always reported a positive cash flow from operatings.
1.2 Ratios
- RDY has a better Return On Assets (10.62%) than 91.71% of its industry peers.
- With an excellent Return On Equity value of 16.03%, RDY belongs to the best of the industry, outperforming 89.12% of the companies in the same industry.
- RDY has a better Return On Invested Capital (13.03%) than 91.71% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for RDY is above the industry average of 12.93%.
| 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
- The Profit Margin of RDY (16.82%) is better than 88.60% of its industry peers.
- RDY's Profit Margin has improved in the last couple of years.
- RDY has a Operating Margin of 19.62%. This is amongst the best in the industry. RDY outperforms 87.05% of its industry peers.
- In the last couple of years the Operating Margin of RDY has grown nicely.
- The Gross Margin of RDY (66.88%) is better than 77.20% of its industry peers.
- 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
- RDY has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it 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.
- The debt/assets ratio for RDY is higher compared to a year ago.
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 77.72% 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.
- With an excellent Debt to FCF ratio value of 3.17, RDY belongs to the best of the industry, outperforming 90.67% 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 of 0.03. This is comparable to the rest of the industry: RDY outperforms 54.40% 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.
- RDY's Current ratio of 1.85 is on the low side compared to the rest of the industry. RDY is outperformed by 63.21% of its industry peers.
- A Quick Ratio of 1.35 indicates that RDY should not have too much problems paying its short term obligations.
- The Quick ratio of RDY (1.35) is worse than 66.32% of its industry peers.
- The current and quick ratio evaluation for RDY is rather negative, while it does have 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.
- RDY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 23.62% yearly.
- The Revenue has grown by 11.06% in the past year. This is quite good.
- RDY shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 13.26% yearly.
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
- RDY is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.42% yearly.
- Based on estimates for the next years, RDY will show a small growth in Revenue. The Revenue will grow by 6.32% on average per year.
EPS Next Y-6.34%
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
EPS Next 5YN/A
Revenue Next Year6.48%
Revenue Next 2Y4.7%
Revenue Next 3Y6.26%
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
- A Price/Earnings ratio of 19.70 indicates a rather expensive valuation of RDY.
- RDY's Price/Earnings ratio is rather cheap when compared to the industry. RDY is cheaper than 83.94% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.07. RDY is valued slightly cheaper when compared to this.
- RDY is valuated rather expensively with a Price/Forward Earnings ratio of 22.90.
- RDY's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. RDY is cheaper than 76.68% of the companies in the same industry.
- RDY's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.05.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.7 | ||
| Fwd PE | 22.9 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, RDY is valued cheaper than 86.53% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, RDY is valued a bit cheaper than the industry average as 77.20% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 59.03 | ||
| EV/EBITDA | 11.7 |
4.3 Compensation for Growth
- RDY has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.83
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.61%, RDY is not a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 0.66, RDY pays a better dividend. On top of this RDY pays more dividend than 89.12% of the companies listed in the same industry.
- With a Dividend Yield of 0.61, RDY pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.61% |
5.2 History
- The dividend of RDY decreases each year by -19.44%.
- RDY has paid a dividend for at least 10 years, which is 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-8.18%
EPS Next 3Y-1.42%
14.38
-0.2 (-1.37%)
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 Change0.41%
Ins Owners1.23%
Ins Owner ChangeN/A
Market Cap11.97B
Revenue(TTM)346.82B
Net Income(TTM)57.72B
Analysts67.27
Price Target15.24 (5.98%)
Short Float %2.13%
Short Ratio8.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.61% |
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)2.13%
PT rev (3m)1.34%
EPS NQ rev (1m)0.02%
EPS NQ rev (3m)-3.66%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.74%
Revenue NQ rev (1m)-0.43%
Revenue NQ rev (3m)-1.38%
Revenue NY rev (1m)1.31%
Revenue NY rev (3m)1.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.7 | ||
| Fwd PE | 22.9 | ||
| P/S | 3.18 | ||
| P/FCF | 59.03 | ||
| P/OCF | 18.54 | ||
| P/B | 3.03 | ||
| P/tB | 4.45 | ||
| EV/EBITDA | 11.7 |
EPS(TTM)0.73
EY5.08%
EPS(NY)0.63
Fwd EY4.37%
FCF(TTM)0.24
FCFY1.69%
OCF(TTM)0.78
OCFY5.39%
SpS4.52
BVpS4.75
TBVpS3.23
PEG (NY)N/A
PEG (5Y)0.83
Graham Number8.83
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 Year6.48%
Revenue Next 2Y4.7%
Revenue Next 3Y6.26%
Revenue Next 5Y6.32%
EBIT growth 1Y1.53%
EBIT growth 3Y25.68%
EBIT growth 5Y18.58%
EBIT Next Year11.9%
EBIT Next 3Y6.94%
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%.