⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
DRREDDY - Swing Trade Analysis with AI Signals
Back to ListSwing Trade Rating: 3.5
| Stock Code | DRREDDY | Market Cap | 1,03,090 Cr. | Current Price | 1,235 ₹ | High / Low | 1,380 ₹ |
| Stock P/E | 22.2 | Book Value | 378 ₹ | Dividend Yield | 0.65 % | ROCE | 25.8 % |
| ROE | 20.3 % | Face Value | 1.00 ₹ | DMA 50 | 1,230 ₹ | DMA 200 | 1,245 ₹ |
| Chg in FII Hold | -2.35 % | Chg in DII Hold | 2.45 % | PAT Qtr | 90.6 Cr. | PAT Prev Qtr | 387 Cr. |
| RSI | 53.9 | MACD | -9.35 | Volume | 15,72,115 | Avg Vol 1Wk | 14,33,978 |
| Low price | 1,020 ₹ | High price | 1,380 ₹ | PEG Ratio | 0.45 | Debt to equity | 0.13 |
| 52w Index | 59.8 % | Qtr Profit Var | -89.3 % | EPS | 55.6 ₹ | Industry PE | 28.2 |
📊 Dr. Reddy’s Laboratories (DRREDDY) shows strong fundamentals with efficient capital usage but faces weak short-term earnings and bearish technical signals. It is a moderately good candidate for swing trading with cautious positioning near support levels.
✅ Optimal Entry Price: 1,220–1,230 ₹ (near 50 DMA support)
🚪 Exit Strategy if Holding: Consider exiting near 1,280–1,300 ₹ (short-term resistance zone) or if RSI moves above 60.
Positive
- 💡 Strong ROCE (25.8%) and ROE (20.3%) indicate efficient capital usage.
- 📈 EPS of 55.6 ₹ supports earnings strength.
- 🏦 Low debt-to-equity ratio (0.13) ensures financial stability.
- 📊 PEG ratio of 0.45 suggests fair valuation relative to growth.
- 📈 Large market cap of 1,03,090 Cr. ensures liquidity and investor confidence.
Limitation
- ⚠️ PAT dropped sharply from 387 Cr. to 90.6 Cr., showing earnings weakness.
- 📉 MACD (-9.35) signals bearish momentum.
- 🔻 Dividend yield of 0.65% is modest, reducing passive income appeal.
- 📊 Current price close to DMA levels (50 DMA: 1,230 ₹, 200 DMA: 1,245 ₹), showing limited breakout potential.
Company Negative News
- 📉 Decline in FII holdings (-2.35%) shows reduced foreign investor confidence.
- 📊 Quarterly profit variation (-89.3%) highlights sharp earnings decline.
Company Positive News
- 📈 Increase in DII holdings (+2.45%) reflects strong domestic institutional support.
- 📊 Pharma sector demand supports long-term growth despite short-term weakness.
Industry
- 🏭 Industry P/E at 28.2 is slightly higher than Dr. Reddy’s 22.2, suggesting fair valuation compared to peers.
- 📈 Pharma sector remains resilient, supported by global demand for generics and specialty drugs.
Conclusion
🔎 Dr. Reddy’s Laboratories is fundamentally strong but technically weak in the short term. Swing traders may enter near 1,220–1,230 ₹ and exit near 1,280–1,300 ₹. Monitoring RSI and MACD is crucial, as momentum indicators suggest limited upside unless a reversal occurs.