Dr Reddys Laboratories Ltd (DRREDDY) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Lupin

Zydus Lifesci.

Laurus Labs

Biocon

Mankind Pharma

Glenmark Pharma

Aurobindo Pharma

Cipla

Alkem Lab

Abbott India

Dr Reddy's Labs

Why is Dr Reddys Laboratories Ltd ?

With a fall in PBT of -58.96%, the company declared Very Negative results in Jun 26

The company has declared negative results for the last 4 consecutive quarters
PAT(9M) At Rs 1,875.10 cr has Grown at -57.63%
PBT LESS OI(Q) At Rs 198.60 cr has Fallen at -80.3% (vs previous 4Q average)
INTEREST(9M) At Rs 325.60 cr has Grown at 36.06%

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -5.28% returns in the last 1 year, the stock has also underperformed BSE500 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you sell?

All quantity irrespective of whether you are making profits or losses

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Pharmaceuticals & Biotechnology)

When to re-enter? - We will constantly monitor the company and review our call based on new data

Is Dr Reddy's Labs for you?

Medium Risk, Medium Return

Absolute

Risk Adjusted

Volatility

Dr Reddy's Labs

-5.28%

-0.22

23.68%

Sensex

-3.2%

-0.24

13.59%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

11.17%

EBIT Growth (5y)

5.95%

EBIT to Interest (avg)

26.00

Debt to EBITDA (avg)

0.58

Net Debt to Equity (avg)

0.01

Sales to Capital Employed (avg)

0.91

Tax Ratio

21.22%

Dividend Payout Ratio

11.80%

Pledged Shares

Institutional Holding

63.81%

ROCE (avg)

20.11%

ROE (avg)

15.68%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

2.56

EV to EBIT

32.26

EV to EBITDA

18.96

EV to Capital Employed

2.53

EV to Sales

2.93

PEG Ratio

Dividend Yield

0.69%

ROCE (Latest)

11.43%

ROE (Latest)

11.07%

Loading Valuation Snapshot...

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Moving Averages

Mildly Bullish (Daily)

KST

Bearish

Bullish

Dow Theory

Mildly Bearish

No Trend

OBV

Bearish

No Trend

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

2What is working for the Company

NO KEY POSITIVE TRIGGERS

-24What is not working for the Company

PAT(9M)

At Rs 1,875.10 cr has Grown at -57.63%

PBT LESS OI(Q)

At Rs 198.60 cr has Fallen at -80.3% (vs previous 4Q average

INTEREST(9M)

At Rs 325.60 cr has Grown at 36.06%

ROCE(HY)

Lowest at 12.64%

DEBT-EQUITY RATIO(HY)

Highest at 0.20 times

DEBTORS TURNOVER RATIO(HY)

Lowest at 3.32 times

NON-OPERATING INCOME(Q)

is 64.11 % of Profit Before Tax (PBT

Loading Valuation Snapshot...

Here's what is not working for Dr Reddy's Labs

Profit Before Tax less Other Income (PBT) - Quarterly

At Rs 198.60 cr has Fallen at -80.3% (vs previous 4Q average)

over average PBT of the previous four quarters of Rs 1,008.58 Cr

MOJO Watch

Near term PBT trend is very negative

PBT less Other Income (Rs Cr)

Profit After Tax (PAT) - Quarterly

At Rs 444.30 cr has Fallen at -57.6% (vs previous 4Q average)

over average PAT of the previous four quarters of Rs 1,049.00 Cr

MOJO Watch

Near term PAT trend is very negative

PAT (Rs Cr)

Interest - Quarterly

Highest at Rs 125.50 cr

in the last five quarters and Increased by 18.73 % (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (Rs cr)

Non Operating Income - Quarterly

is 64.11 % of Profit Before Tax (PBT)

MOJO Watch

The company's income from non business activities is high; which is not a sustainable business model

Non Operating Income to PBT

Debt-Equity Ratio - Half Yearly

Highest at 0.20 times

in the last five half yearly periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio

Debtors Turnover Ratio- Half Yearly

Lowest at 3.32 times

in the last five half yearly periods

MOJO Watch

Company's pace of settling its Debtors has slowed

Debtors Turnover Ratio