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Dr. Reddy's Laboratories Limited

RDY
37
Drug Manufacturers - Specialty & Generic · Healthcare
Price
$12.22
+0.11 (+0.91%)
Market Cap
$10.18B
Exchange
New York Stock Exchange
Winston Score
37
Winston is serious
Below-average fundamentals — multiple weak pillars.
Data as of Aug 10, 2026 · filings through Jun 30, 2026

Dr. Reddy's Laboratories Limited, alongside its associated companies, functions as a holistic pharmaceutical entity with a global footprint. Its business operations are divided into several key divisions. The Global Generics segment is responsible for the manufacturing and sale of both prescription and over-the-counter finished pharmaceutical products. These offerings are available either under a proprietary brand or as generic formulations that are therapeutically identical to their branded equivalents. This segment also includes the company's biologics ventures. The Pharmaceutical Services and Active Ingredients (PSAI) division focuses on producing and distributing active pharmaceutical ingredients (APIs) and chemical intermediates, which serve as crucial building blocks for final drug products. Additionally, PSAI provides contract research services and produces custom-specified APIs and steroids for clients. The Proprietary Products segment is dedicated to the research and advancement of unique pharmaceutical formulations. The Others segment is actively involved in developing treatments, primarily for oncology (cancer) and inflammatory conditions. Dr. Reddy's addresses a broad spectrum of therapeutic areas, including gastrointestinal issues, cardiovascular health, diabetes, dermatological concerns, cancer, respiratory diseases, oral health, urological disorders, and nephrological conditions. The company has also established a partnership with Curis, Inc., centered on the discovery, development, and commercialization of small molecule antagonists designed for immuno-oncology and precision oncology targets. Founded in 1984, Dr. Reddy's Laboratories Limited maintains its principal office in Hyderabad, India.

Winston Score History

Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-5.0% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-68.6% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$25.3B/ year

Declining (-8% vs prior year)

7.2% of revenue

Below sector average (18%)

R&D spend declining — could signal cost-cutting or efficiency

Cash Runway

~5 years

$97.3B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

$97.3B cash & investments at current burn rate

Revenue declining

Dr. Reddy's Laboratories Limited's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

+0.2% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 831.7M (2022) → 833.3M (2026)

Score breakdown

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Quality

Gross Margin
46.5%
Healthy — 46.5% gross margin
Operating Margin
3.7%
Thin — 3.7% operating margin
ROCE
0.7%
Weak — 0.7% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY
-0.4%
Shrinking sales (-0.4% YoY)
EPS YoY
-41.6%
Earnings shrinking (-41.6% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Cash Conversion
124%
Turns 124% of profit into real cash
FCF Margin
4.6%
Thin free cash flow (4.6%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity
0.15
Conservative — low debt load (0.15)
Interest Cover
8.39x
Comfortably covers interest (8.4x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)
0.3x
Attractive valuation — P/E 0.3

P/E under 10. The price tag is small relative to last year's profit.

P/E vs Forward
+0.0
GROWING
Earnings roughly flat

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Dividends

Dividend Yield
0.68%
Small dividend — 0.68% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth
-14.9%
Dividend cut (-14.9% YoY) — warning sign

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