Dr. Reddy's Laboratories Ltd.
NSE: DRREDDYDr. Reddy's Laboratories Ltd.: A 30-second snapshot
Dr. Reddy's Laboratories (DRREDDY) trades at ₹1,272 with a trailing PE of 24.66 and a forward PE of 19.64, sitting just below its 50-DMA (₹1,287) but above its 200-DMA (₹1,265). The stock is -2.93% over 12 months against a pharma peer group where 1-year price changes are unavailable for direct comparison. Fundamental metrics show 5-year earnings growth of -86.2% and a debt-to-equity of 20.33 (rising trend), alongside an ROE of 11.84% — the weakest quality score in a 6-stock pharma cohort.
P/E
24.7
Forward P/E
19.6
ROE
+11.8%
Debt / Equity
20.33
Profit Margin
+12.8%
Div. Yield
+0.6%
5Y ROE > 15%
3/5
5Y FCF > 0
4/5
Quality
41/100
News
8 headlines · 3 positive · 1 negative
Dr. Reddy's launches generic cancer drug Bosutinib in U.S. - The Hindu
The Hindu
Dr. Reddy's Announces the First-to-Market Launch of Bosutinib Tablets 400mg, a Generic Equivalent of Bosulif - Business Wire
Business Wire
Dr. Reddy's Laboratories Ltd. - These 7 stocks reported declining EPS for 4 straight quarters - The Economic Times
The Economic Times
Q&A: Dr. Reddy's CEO on Generic Semaglutide and the GLP-1 Market Ahead - Pharmaceutical Commerce
Pharmaceutical Commerce
Dr. Reddy's (NYSE: RDY) reports full SEBI compliance for FY 2026 - Stock Titan
Stock Titan
Recent context
- ·In June 2026, Dr. Reddy's launched generic Bosutinib 400mg in the U.S. as a first-to-market entrant — a branded cancer drug equivalent that represents an incremental revenue stream in the specialty generics segment.
- ·The company's CEO discussed the GLP-1 market and generic semaglutide pipeline in early June 2026, signaling interest in one of the fastest-growing global drug categories, though no commercial launch has been announced.
- ·Dr. Reddy's reported full SEBI compliance for FY 2026 in May 2026, and the company's name appeared in an Economic Times article listing stocks with 4 consecutive quarters of declining EPS, highlighting the near-term earnings trajectory.
Strengths
- +FCF has been positive in 4 of the available historical years, indicating the business has generated cash despite earnings volatility.
- +Forward PE of 19.64 represents a ~20% discount to the trailing PE of 24.66, which the consensus of 39 analysts (mean rating 2.72 on a 1-5 scale, lower = more constructive) may reflect in expectations of an earnings recovery.
- +June 2026 first-to-market U.S. launch of generic Bosutinib (400mg) adds a pipeline catalyst in the oncology generics segment, expanding the U.S. generics portfolio.
- +Trailing PE of 24.66 is the lowest in the 6-stock pharma peer cohort, where peers range from Cipla at 28.2 to Divi's at 70.0, positioning DRREDDY at the low-valuation end of the sector on this metric.
Weaknesses
- −5-year earnings growth of -86.2% and 5-year revenue growth of -11.6% represent sustained multi-year deterioration; the company was among those cited as reporting declining EPS for 4 straight consecutive quarters.
- −Debt-to-equity of 20.33 with a rising debt trend is substantially elevated for a pharma manufacturer; this combination of high leverage and contracting earnings increases balance sheet sensitivity.
- −ROE of 11.84% clears the 15% threshold in only 3 of available historical years, and the quality score of 25 ranks last in the 6-peer cohort (sector leader Sun Pharma at 59, Divi's at 51).
- −Consistency score of 40/100 reflects limited earnings durability; ROE persistence below 15% in the majority of measured years suggests structural rather than cyclical profitability pressure.
Open questions
- ?Does the 5-year earnings decline of -86.2% reflect one-time write-downs or impairments, or does it indicate a structural change in the company's core generics business profitability?
- ?How has the debt-to-equity ratio of 20.33 evolved over the last 3-5 years, and what proportion of the debt is long-term versus short-term, and how does the interest coverage ratio look against current operating earnings?
- ?Is the forward PE discount of ~20% relative to trailing PE supported by a credible earnings recovery path — for example, through the GLP-1 generics pipeline or U.S. first-to-market launches — or does it simply reflect consensus optimism not yet grounded in visible catalysts?
- ?How does DRREDDY's U.S. generics revenue mix and regulatory track record with the FDA compare to peers like Sun Pharma and Cipla, given that U.S. approvals and import alerts have historically driven outsized moves for Indian pharma companies?
Peer comparison: Pharma
Ranks 5 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| DRREDDY | Dr. Reddy's Laboratories Ltd.You're viewing | 24.7 | +11.8% | 25 |
| Industry avg | across 5 peers | 54.8 | +15.7% | 43 |
| SUNPHARMA | Sun Pharmaceutical Industries Ltd. | 38.5 | +14.7% | 59 |
| DIVISLAB | Divi's Laboratories Ltd. | 70.0 | +16.2% | 51 |
| APOLLOHOSP | Apollo Hospitals Enterprise Ltd. | 62.9 | +21.5% | 44 |
| MAXHEALTH | Max Healthcare Institute Ltd. | 74.2 | +14.3% | 37 |
| CIPLA | Cipla Ltd. | 28.2 | +11.7% | 24 |
Technical state
Current price
₹1,272.10
SMA 50
₹1,287.46
SMA 200
₹1,264.65
RSI (14)
44.7 (neutral)
From 52w high
-7.5%
1Y return
-2.9%
3M return
-0.2%
50-DMA
Below
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- high5-year earnings growth of -86.2% and 5-year revenue growth of -11.6% indicate sustained deterioration across both top and bottom lines; this is one of the most severe multi-year earnings declines among large-cap pharma peers in the cohort.
- highDebt-to-equity of 20.33 is substantially elevated for a non-bank pharma manufacturer, and the debt trend is classified as rising; combined with multi-year earnings contraction, this heightens sensitivity to further revenue softness.
- mediumROE of 11.84% cleared the 15% threshold in only 3 of the available historical years; quality score of 25 ranks last (5th of 6, tied with Cipla at 24) in the peer cohort, with sector leader Sun Pharma at 59 and Divi's at 51.
- mediumOne of 8 recent articles carried negative sentiment citing Dr. Reddy's among stocks with declining EPS for 4 straight quarters; news sample of 8 articles is thin for a large-cap name, limiting signal reliability.
- lowPrice is -2.93% over 12 months and -0.19% over 3 months, below SMA-50 (₹1,287) though above SMA-200 (₹1,265); RSI of 44.74 is in neutral territory with a 7.54% drawdown from the 52-week high.
Cross-section contradictions
- 5-year earnings growth of -86.2% and last-place quality score in the peer cohort contrast with the stock trading above its 200-DMA (₹1,265) and a forward PE of 19.64 roughly 20% below the trailing PE of 24.66, implying the market prices in an earnings recovery not yet visible in the 5-year trajectory.
- News sentiment labels the overall flow positive (3 positive, 4 neutral, 1 negative) while analyst mean rating of 2.72 across 39 analysts (1-5 scale, lower = more constructive) sits in the middle of the scale, a less constructive position than the news label alone would suggest.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 24 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 21 Jun 2026 · rotates through NIFTY 500 every ~5 days