Dr. Reddy's Laboratories Limited (DRREDDY) fair value: what the stock is really worth
We calculate from audited financials what Dr. Reddy's Laboratories Limited is really worth. The fair value tells you whether the price is too high or too low, the quality score (0 to 100) how solid the business behind it is. 26 models, 37 quality factors, updated daily.
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Price vs Fair Value
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 18, 2026.
How to read this chart
60‑month range ₹719.50 – ₹981,623 · fair‑value band ₹579.01 – ₹1,193 · the ₹1,185 price screens above the ₹874.79 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Sep 18, 2026.
Dr. Reddy's Laboratories Limited, together with its subsidiaries, operates as an integrated pharmaceutical company North America, Europe, India, Russia, and internationally. The company operates through Global Generics, Pharmaceutical Services and Active Ingredients (PSAI), and Others segment.
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Dr. Reddy's Laboratories Limited, together with its subsidiaries, operates as an integrated pharmaceutical company North America, Europe, India, Russia, and internationally. The company operates through Global Generics, Pharmaceutical Services and Active Ingredients (PSAI), and Others segment. Its Global Generics segment manufactures and markets prescription and over-the-counter finished pharmaceutical products that are marketed under a brand name or as a generic finished dosages with therapeutic equivalence to branded formulations, as well as engages in the biologics business. The PSAI segment manufactures and markets active pharmaceutical ingredients and intermediates, which are principal ingredients for finished pharmaceutical products. This segment also provides contract research services; and manufactures and sells active pharmaceutical ingredients and steroids with the customer requirements. Its Others segment engages in developing therapies in the fields of oncology and inflammation; and research, development, and commercialization of differentiated formulations. The company offers its products for various therapeutic categories, including gastro-intestinal, cardiovascular, anti-diabetic, dermatology, oncology, respiratory, stomatology, urology, and nephrology, vaccines, vitamins and minerals, and pain management. Dr. Reddy's Laboratories Limited was incorporated in 1984 and is headquartered in Hyderabad, India.
Stock analysis
Dr. Reddy's Laboratories Limited (DRREDDY) currently trades at ₹1,185, while our model-based Fair Value estimate is ₹874.79, implying the stock looks roughly 35.5% overvalued today.
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Valuation
Bull case: the DCF Models group reads highest at a median of ₹1,197 per share, and 6 of the 26 models we run sit above the ₹1,185 price.
Bear case: the Dividend Discount group reads lowest at ₹137.56, and 20 of the 26 models stay below the price. Evidence for this calculation is high.
Scenario range: ₹579.01 (bear) to ₹1,193 (bull), the price of ₹1,185 sits inside it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 49/100 (below-average quality), in the Healthcare sector.
Healthy Growth: Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Dr. Reddy's Laboratories Limited reported revenue of ₹336B in FY2026 versus ₹214B in FY2022, a compound +11.9%/yr. Reported net income was ₹42.9B in FY2026, compounding +16.1%/yr from FY2022.
Key figures
Market cap ₹987B (≈ $10.3B) · P/E ratio 23.3 · P/S ratio 2.97 · EPS (TTM) ₹50.87 · Dividend yield 0.7% · Net margin 12.8% · Return on equity 11.8% · Return on assets (EBIT) 13.5%.
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 46 out of 100 (medium confidence).
What moves the price
The share trades about 14% below its 52-week high and 3% above its 52-week low, currently below its 200-day average.
For context, the median of 10 Healthcare peers we cover trades at −18% fair-value upside, at −26%, DRREDDY screens richer than that median.
Fair Value models
Bear ₹579.01Fair Value ₹874.79Bull ₹1,193
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above is their evidence-weighted blend, not the output of a single model. Based on fiscal year 2026 figures (about 6 months old). Earnings retained since then (₹20.68 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target.Evidence ⓘEvidence = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.91/100
Revenue growth appears healthy and is supported by profitability and cash-flow quality.
Revenue growth 1 year
+3.2%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+11.0%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+12.1%
Revenue growth 25 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+14.7%
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What shareholders gained per year (last 5 years), in INR ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate. Basis: adjusted. Measured in INR: this currency has depreciated against the euro and dollar over the long run, so part of the nominal rate is currency erosion that never reaches a EUR/USD investor.
+17.0%
Earnings growth per share plus dividend.
Earnings per share, growth per year+16.3%
Dividend (yield on the price)0.7%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.17% vs 8%, picking up
Profit margin 2021 to 2026 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.13% → 14%
Growth Forecast
A lot of optimism in the price
The price assumes more growth than the company has delivered so far and more than analysts expect.
What the price assumes ⓘThis turns our valuation around: instead of asking what the share is worth, it asks what growth the current price requires. It uses the cash the company keeps after all spending (free cash flow), the same discount rate as our models, five years of growth, then slowing evenly to 2 % a year by year ten. Compared with the analysts' sales forecasts extended to the same five years (at least three analysts, for context only, it does not enter the Fair Value): within 3 percentage points counts as "in line" (amber), below that little optimism (green), above that a lot of optimism (red).
+20.2%
Yearly growth needed for the next five years to justify today's price.
What forecasts expect ⓘAnalysts publish sales forecasts for the next two fiscal years. For the years after that, growth slows evenly to 2 % a year by year ten (2 % is the long-run rate our models use). Projected years are marked as such.
+8.6%
Yearly sales growth analysts expect, extended to five years.
Compare Dr. Reddy's Laboratories Limited with another stock
Price, fair value, quality and upside side by side.
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Drug Manufacturers - Specialty & Generic · 607 stocks
Beats the industry median on 5/15 measures
Overall it trails its industry peers.
Valuation
Quality Score49 · Below median
Fair Value upside−24% · Below median
Profitability
Return on equity (TTM)12% · Above median
Return on assets6% · Above median
Net margin (TTM)13% · Above median
Operating margin (TTM)2% · Below median
Growth and dividend
Revenue growth−12% · Bottom 25%
Dividend yield (TTM)0.7% · Below median
Balance sheet
Debt / equity0.03× · Below median
Valuation Multiplesvs Drug Manufacturers - Specialty & Generic median · lower = cheaper
P/E (TTM)23.3× · Pricier than median
P/B2.67× · Pricier than median
P/S (TTM)3.00× · Pricier than median
P/FCF0.4× · Cheapest 25%
EV/EBITDA14.8× · Pricier than median
PEG1.55× · Pricier than median
Strength profile in five axes (Snowflake)
This stockSector peers
VALUE (fair-value potential)0· sector 13
FUTURE (revenue growth)0· sector 21
PAST (return on equity)47· sector 24
HEALTH (low debt)98· sector 97
DIVIDEND (yield)14· sector 30
VALUE 0: the price sits above our fair-value range.
For bloggers, editors and developers: paste this into your site or blog (a “Custom HTML” block in WordPress), it shows the current fair value and links back here. Free, plain HTML, and welcome. Full data streams (CSV/JSON) at /developers.
Is Dr. Reddy's Laboratories Limited (DRREDDY) overvalued or undervalued?
As of Sep 18, 2026, our model estimates a fair value of ₹874.79 versus a price of ₹1,185, about −26% upside (overvalued).
What is the fair value of DRREDDY?
Our model-based fair value for Dr. Reddy's Laboratories Limited is ₹874.79 (as of Sep 18, 2026), built from audited fundamentals. The current price: ₹1,185.
What is the quality score of DRREDDY?
Dr. Reddy's Laboratories Limited has a Quality Score of 49/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Dr. Reddy's Laboratories Limited (DRREDDY)?
Our model-based price target is the fair value of ₹874.79 (as of Sep 18, 2026) from 26 valuation models. Cautious scenario ₹579.01, optimistic scenario ₹1,193. It is a calculation from audited fundamentals, not an analyst target.
What is the Dr. Reddy's Laboratories Limited stock forecast for 2026?
Our models put fair value at ₹874.79, about −26% upside versus a price of ₹1,185 (overvalued). Cautious scenario ₹579.01, optimistic scenario ₹1,193. The calculation is refreshed regularly with new filings.
What is the revenue of Dr. Reddy's Laboratories Limited (DRREDDY)?
Dr. Reddy's Laboratories Limited reported trailing-twelve-month revenue of about ₹336B (latest available figure, as of Sep 18, 2026).
Does Dr. Reddy's Laboratories Limited pay a dividend?
Dr. Reddy's Laboratories Limited currently shows a dividend yield of about 0.68% relative to its recent price (as of Sep 18, 2026).
What growth is priced into Dr. Reddy's Laboratories Limited (DRREDDY)?
For today's price to be fair in a discounted-cash-flow model, Dr. Reddy's Laboratories Limited would have to grow free cash flow by +20.2 % per year for five years (discount rate 10.4 %, then slowing evenly to 2 % perpetual growth by year ten). Over the last 5 years revenue grew +12.1 % per year. As of Sep 18, 2026.
What discount rate (WACC) does the fair value of DRREDDY use?
Our models discount Dr. Reddy's Laboratories Limited at 10.4 %: a base by market capitalisation (large), damped by beta 0.26, country premium for India. The same rate applies in all 26 models.
What is a reverse DCF?
A reverse DCF turns the usual calculation around. Instead of deriving a value from assumptions, it takes today's price as given and asks: what free-cash-flow growth would a company have to deliver for exactly this price to be fair? The result is not a forecast but the expectation already priced in. For Dr. Reddy's Laboratories Limited that is +20.2 % per year a year over ten years, using the same discount rate (10.4 %) and the same formula as our fair value.
How much growth has Dr. Reddy's Laboratories Limited (DRREDDY) delivered so far?
Over the past 5 years revenue at Dr. Reddy's Laboratories Limited grew +12.1 % a year. The price currently implies +20.2 % per year free-cash-flow growth a year. Comparing the two shows how much confidence is in the price: if it demands more than has been delivered, the business has to accelerate for the maths to work.
How fast is the sector of Dr. Reddy's Laboratories Limited (DRREDDY) growing?
The median revenue growth in the sector is +4.3 % a year. That is the yardstick for the growth priced into Dr. Reddy's Laboratories Limited (+20.2 % per year a year): it shows whether the expectation is within the usual range or beyond it.
What is the free cash flow yield of Dr. Reddy's Laboratories Limited (DRREDDY)?
The free-cash-flow yield on the price is 3.09 %: that much free cash flow Dr. Reddy's Laboratories Limited produces per unit of market value. When it exceeds the discount rate of our models (10.4 %), the business already earns more than its cost of capital demands, and the price needs little additional growth.
What is the intrinsic value of Dr. Reddy's Laboratories Limited (DRREDDY)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For Dr. Reddy's Laboratories Limited it is ₹874.79 per share (as of Sep 18, 2026), against a price of ₹1,185. It is the blended result of 26 valuation models (cash flow, earnings, asset, dividend).
Is Dr. Reddy's Laboratories Limited stock overvalued or undervalued in 2026?
As of Sep 18, 2026, DRREDDY trades above its calculated fair value: price ₹1,185, fair value ₹874.79, a gap of about −26% (overvalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of DRREDDY?
No. The price is what the market pays today (₹1,185); the fair value is what the company's own numbers justify (₹874.79). For Dr. Reddy's Laboratories Limited the two are ₹310.21 per share apart. That gap is exactly why we show both numbers side by side.
How much is Dr. Reddy's Laboratories Limited worth?
The market values Dr. Reddy's Laboratories Limited at about ₹987B (market capitalisation, as of Sep 18, 2026). Per share that is ₹1,185; our models calculate a fair value of ₹874.79 per share.
What do the bullish and bearish scenarios say about DRREDDY?
Our models span a range for Dr. Reddy's Laboratories Limited: cautious scenario ₹579.01, base ₹874.79, optimistic ₹1,193 per share (as of Sep 18, 2026, price ₹1,185). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of DRREDDY?
Dr. Reddy's Laboratories Limited trades at a price-to-earnings ratio of 23.3 (as of Sep 18, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of ₹874.79 is built from several models across several years. Other multiples: PEG 1.5, P/B 2.7, P/S 3.0, EV/EBITDA 14.8.
What is the PEG ratio of DRREDDY?
The PEG ratio of Dr. Reddy's Laboratories Limited is 1.55 (P/E divided by earnings growth, as of Sep 18, 2026). That is above 1, so the growth is already paid for in the price.
How solid is the balance sheet of Dr. Reddy's Laboratories Limited (DRREDDY)?
Balance-sheet figures for Dr. Reddy's Laboratories Limited (as of Sep 18, 2026): return on equity 11.8%, debt of 0.03 per unit of equity. They feed the Quality Score of 49/100, which measures business quality independently of the share price.
How far is DRREDDY from its 52-week high?
Dr. Reddy's Laboratories Limited trades at ₹1,185, about 14% below its 52-week high of ₹1,376 and 3% above the low of ₹1,148 (as of Sep 18, 2026). Distance from the high says nothing about value: that is what the fair value of ₹874.79 is for.
Which stocks are comparable to Dr. Reddy's Laboratories Limited?
From the same area (Healthcare) we also value Merck KGaA, Takeda Pharmaceutical Company, Jiangsu Hengrui Pharmaceuticals Co, Sun Pharmaceutical Industries Limited, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is Dr. Reddy's Laboratories Limited stock attractive at the current price?
The data as of Sep 18, 2026: price ₹1,185, calculated fair value ₹874.79 (−26%), Quality Score 49/100, from 26 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of DRREDDY calculated?
We run Dr. Reddy's Laboratories Limited through 26 models from four families: discounted cash flow, earnings models, asset and balance-sheet models, and dividend models. Every model gets the same audited fundamentals; the result is the weighted average of ₹874.79, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 16.1 % above its aggregate fair value. Dr. Reddy's Laboratories Limited itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of Dr. Reddy's Laboratories Limited (DRREDDY)?
The closing price on Sep 18, 2026 was ₹1,185. Our model-based fair value is ₹874.79, about −26% upside (overvalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with Dr. Reddy's Laboratories Limited right now?
Solid but not exceptional quality (49/100) and above fair value, neither a clear bargain nor a standout compounder. A fairly wide model range (₹579.01 to ₹1,193) leaves room in how you read the outcome.
Where does the earnings growth of Dr. Reddy's Laboratories Limited (DRREDDY) come from?
Earnings per share at Dr. Reddy's Laboratories Limited grew +12.6 % a year from 2015 to 2026. Broken into its drivers: revenue per share +9.0 %, EBIT margin +2.6 %, tax rate −0.2 %, residual (interest, one-offs) +0.9 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of Dr. Reddy's Laboratories Limited
How large is the market capitalisation of Dr. Reddy's Laboratories Limited (DRREDDY)?
The market capitalisation of Dr. Reddy's Laboratories Limited is ₹987B (≈ $10.3B). The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of Dr. Reddy's Laboratories Limited (DRREDDY)?
The price-to-sales ratio of Dr. Reddy's Laboratories Limited is 2.97 (P/E × margin). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of Dr. Reddy's Laboratories Limited (DRREDDY)?
Earnings per share at Dr. Reddy's Laboratories Limited are ₹50.87 (price ÷ EPS = P/E 23.3). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of Dr. Reddy's Laboratories Limited (DRREDDY)?
The dividend yield of Dr. Reddy's Laboratories Limited is 0.7% (payout 15.7%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of Dr. Reddy's Laboratories Limited (DRREDDY)?
The net margin of Dr. Reddy's Laboratories Limited is 12.8% (fiscal year 2026). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of Dr. Reddy's Laboratories Limited (DRREDDY)?
The return on equity (ROE) of Dr. Reddy's Laboratories Limited is 11.8% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of Dr. Reddy's Laboratories Limited (DRREDDY)?
On an EBIT basis the return on assets of Dr. Reddy's Laboratories Limited is 13.5% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of Dr. Reddy's Laboratories Limited (DRREDDY)?
The operating margin of Dr. Reddy's Laboratories Limited is 1.5% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at Dr. Reddy's Laboratories Limited (DRREDDY)?
Revenue at Dr. Reddy's Laboratories Limited is growing −11.6% versus a year earlier (3y avg +11.0%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at Dr. Reddy's Laboratories Limited (DRREDDY)?
Earnings per share at Dr. Reddy's Laboratories Limited are growing −86.2% versus a year earlier. How much earnings per share grew versus a year earlier.
How much net debt does Dr. Reddy's Laboratories Limited (DRREDDY) carry?
The net debt of Dr. Reddy's Laboratories Limited is ₹62.0B (fiscal year 2026, ≈ 2.0 yrs of FCF). Debt minus cash on hand. The note shows how many years of free cash flow could in theory pay it off.
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Broad data
Sep 18, 2026