Buy, Sell or Hold: Brokerage firm Citi has shared its latest view on Hyderabad-based multinational pharmaceutical stock Dr Reddy’s Laboratories. The firm maintains a ‘sell’ rating with a target price of Rs 1,070. Here are the reasons why the brokerage firm maintains the sell rating.
Market analysts believe the immediate stock price increase is likely overstated, even if the approval is verified.
According to the brokerage, the future earnings of the company, estimated for FY26-FY28, are expected to be revised downward, falling 20-23 per cent below the current market consensus.
FY28E product revenue is expected to be around USD 50 million, in a market with six players.
FY27E revenue estimate has been increased to about USD 80-100 million from the earlier USD 60 million, in a market with three players — DRL, Sandoz, and Apotex.
Q4FY26 earnings are expected to reflect results excluding Revlimid.
Market (street) earnings estimates are likely to be reduced.
Dr Reddy’s clarifies report on regulatory nod for Semaglutide in Canada
The company has clarified the report, suggesting approval for Semaglutide in Canada, stating that it has not yet received Health Canada approval for the Semaglutide injection.
Dr Reddy’s share price today
At the time of writing this report (10:22 AM), the pharma stock was down 1.77 per cent, trading at Rs 1,309.50 compared to its previous close of Rs 1,333.05.
Major drug maker Dr Reddy’s Laboratories on January 21 reported its financial performance for the third quarter of the current financial year (FY26). The pharma major posted a double-digit decline in profit after tax (PAT) during the quarter.
The pharma company’s net profit for the quarter fell 14 per cent year-on-year and 16 per cent quarter-on-quarter to Rs 1,210 crore, with a PAT margin of 13.9 per cent.
The large-cap pharma company’s revenue stood at Rs 8,727 crore, a 4.4 per cent year-on-year increase, while declining 0.9 per cent sequentially. Growth during the quarter was driven by the core business, excluding the impact of specific products.
The company’s EBITDA came in at Rs 2,049 crore, with an EBITDA margin of 23.5 per cent.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
