DR. REDDY'S LABORATORIES-ADR (RDY) Stock Fundamental Analysis
NYSE:RDY • US2561352038
14.58 USD
-0.02 (-0.14%)
At close: Feb 26, 2026
14.55 USD
-0.03 (-0.21%)
Pre-Market: 2/27/2026, 8:37:08 AM
We assign a fundamental rating of 6 out of 10 to RDY. RDY was compared to 192 industry peers in the Pharmaceuticals industry. RDY has an excellent profitability rating, but 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
- RDY had positive earnings in the past year.
- RDY had a positive operating cash flow in the past year.
- Each year in the past 5 years RDY has been profitable.
- RDY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 10.62%, RDY belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
- The Return On Equity of RDY (16.03%) is better than 88.54% of its industry peers.
- RDY has a Return On Invested Capital of 13.03%. This is amongst the best in the industry. RDY outperforms 91.67% of its industry peers.
- RDY had an Average Return On Invested Capital over the past 3 years of 15.26%. This is above the industry average of 12.96%.
| 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 88.54% of its industry peers.
- In the last couple of years the Profit Margin of RDY has grown nicely.
- The Operating Margin of RDY (19.62%) is better than 86.98% of its industry peers.
- In the last couple of years the Operating Margin of RDY has grown nicely.
- RDY's Gross Margin of 66.88% is fine compared to the rest of the industry. RDY outperforms 77.08% 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
- RDY has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- RDY has about the same amout of shares outstanding than it did 1 year ago.
- Compared to 5 years ago, RDY has more shares outstanding
- The debt/assets ratio for RDY is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 5.86 indicates that RDY is not in any danger for bankruptcy at the moment.
- RDY has a better Altman-Z score (5.86) than 78.65% of its industry peers.
- 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.
- The Debt to FCF ratio of RDY (3.17) is better than 90.10% 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.
- The Debt to Equity ratio of RDY (0.03) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 5.86 |
ROIC/WACC1.27
WACC10.28%
2.3 Liquidity
- A Current Ratio of 1.85 indicates that RDY should not have too much problems paying its short term obligations.
- With a Current ratio value of 1.85, RDY is not doing good in the industry: 63.54% of the companies in the same industry are doing better.
- RDY has a Quick Ratio of 1.35. This is a normal value and indicates that RDY is financially healthy and should not expect problems in meeting its short term obligations.
- RDY has a worse Quick ratio (1.35) than 66.67% 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.
- RDY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.06%.
- 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.
- RDY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.32% yearly.
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
- 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
- RDY is valuated rather expensively with a Price/Earnings ratio of 19.70.
- RDY's Price/Earnings ratio is rather cheap when compared to the industry. RDY is cheaper than 83.85% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.11. RDY is valued slightly cheaper when compared to this.
- RDY is valuated rather expensively with a Price/Forward Earnings ratio of 23.18.
- Based on the Price/Forward Earnings ratio, RDY is valued a bit cheaper than the industry average as 76.04% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Forward Earnings ratio of 28.13, RDY is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.7 | ||
| Fwd PE | 23.18 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RDY indicates a rather cheap valuation: RDY is cheaper than 86.46% of the companies listed in the same industry.
- 77.08% 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 | 59.75 | ||
| EV/EBITDA | 11.86 |
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
- RDY has a yearly dividend return of 0.63%, which is pretty low.
- Compared to an average industry Dividend Yield of 1.07, RDY pays a better dividend. On top of this RDY pays more dividend than 89.06% 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 1.80.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
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
- RDY pays out 11.54% of its income as dividend. This is a sustainable payout ratio.
- RDY's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP11.54%
EPS Next 2Y-8.18%
EPS Next 3Y-1.42%
14.58
-0.02 (-0.14%)
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 Change0.36%
Ins Owners1.23%
Ins Owner ChangeN/A
Market Cap12.14B
Revenue(TTM)346.82B
Net Income(TTM)57.72B
Analysts67.27
Price Target15.63 (7.2%)
Short Float %2.13%
Short Ratio8.05
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-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)3.96%
EPS NQ rev (1m)0.02%
EPS NQ rev (3m)-3.66%
EPS NY rev (1m)0.02%
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 | 23.18 | ||
| P/S | 3.22 | ||
| P/FCF | 59.75 | ||
| P/OCF | 18.76 | ||
| P/B | 3.06 | ||
| P/tB | 4.5 | ||
| EV/EBITDA | 11.86 |
EPS(TTM)0.74
EY5.08%
EPS(NY)0.63
Fwd EY4.31%
FCF(TTM)0.24
FCFY1.67%
OCF(TTM)0.78
OCFY5.33%
SpS4.53
BVpS4.76
TBVpS3.24
PEG (NY)N/A
PEG (5Y)0.83
Graham Number8.9
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 | 5.86 |
F-Score4
WACC10.28%
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 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%.