Dr. Reddy's Laboratories Limited (RDY) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-0.6%

$14.02

vs $14.11 price

Levered DCF

$10.62

After debt service

Piotroski score

5 / 9

Average

Altman Z-score

5.53

Safe zone

Rating

B+

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2026	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019
P/E	24×	16.63×	18.45×	17.23×	29.85×	43.38×	5.22×	4.97×
P/B	2.91×	2.82×	3.66×	3.36×	3.69×	315.97×	248.25×	3.33×
P/S	3.05×	2.89×	3.68×	3.16×	3.28×	292.64×	2.91×	3.04×
EV / EBITDA	13.66×	10.06×	11.76×	10.54×	16.03×	56.85×	12.18×	14.17×
Gross margin	52.8%	58.5%	58.6%	56.7%	53.1%	50.8%	53.8%	54.2%
Operating margin	13.8%	22.1%	24.3%	23.2%	13.7%	16.9%	9.2%	13.6%
Net margin	12.8%	17.4%	19.9%	18.3%	11.0%	9.1%	11.2%	12.2%
Current ratio	1.8×	1.92×	2.58×	2.38×	1.93×	1.78×	1.79×	1.92×
Debt / equity	0.21×	0.14×	0.07×	0.06×	0.18×	0.18×	0.14×	0.27×
Interest coverage	12.42×	25.4×	39.58×	40.02×	30.77×	0.44×	1,153.61×	23.5×
Dividend yield	0.7%	0.7%	0.6%	0.6%	0.6%	0.6%	0.8%	0.9%
Payout ratio	15.5%	11.8%	11.9%	11.0%	17.6%	1785.9%	20.1%	21.3%

Key metrics by fiscal year

Metric	FY2026	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019
Return on equity	12.2%	17.0%	19.8%	19.5%	12.4%	9.8%	951.7%	13.4%
Return on invested capital	8.1%	13.3%	17.2%	17.2%	9.5%	10.0%	671.3%	9.6%
Return on assets	7.9%	11.5%	14.4%	14.0%	8.0%	6.4%	635.1%	8.3%
Free cash flow yield	3.0%	1.3%	1.8%	5.2%	1.3%	3.1%	4.7%	4.5%
Earnings yield	4.2%	6.0%	5.4%	5.8%	3.4%	0.0%	3.8%	4.0%
Enterprise value	$1.1T	$972.4B	$1T	$784.4B	$722.5B	$748.1B	$508.9B	$503.5B
Net debt / EBITDA	0.73×	0.33×	0.15×	0.1×	0.42×	0.02×	0.01×	1.02×
Cash conversion cycle (days)	195	261	257	229	263	250	3	231