Dr Reddy's Laboratories Ltd ADR

RDY: XNYS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$61.00	Kpjpn	Fvpztqvy

Dr. Reddy’s Earnings: Continued Strength in Execution Lifts Valuation, but Shares Still Pricey

Keonhee Kim

Jul 29, 2024

No-moat Dr. Reddy’s reported stronger-than-expected first-quarter results and started off fiscal 2025 on a solid note. Robust sales growth of 13.9% year over year was fueled by North America and India generics business. After digesting results, we have ticked up our sales and profitability expectations for the full year. We are also impressed by the continued strength in solid execution of the firm. We have raised our fair value estimate to $68 per share, from $60 from our more favorable long-term expectations, and we have a higher conviction on the name currently than before, but we still see shares as overvalued.

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