Citi raises target for Dr Reddy's Laboratories stock to INR 1,450

Published on 10/02/2026 at 14:04 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWS

Citi upgraded Dr Reddy's Laboratories to Buy on September 29, 2026. Dr Reddy's Laboratories stock reports on October 23, 2026.

Dr Reddy, INE089A01023, Illustration mit AI erstellt.

Dr. Reddy's Laboratories (INE089A01023) received a Citi upgrade to Buy on September 29, 2026, as the target rose from INR 1,040 to INR 1,450, according to ET Now. The move puts earnings recovery and margin expansion at the center of the current valuation debate.

Citi sees margin recovery

Citi expects incremental revenue of USD 350.0 million to USD 400.0 million from fiscal 2027 through fiscal 2029, while its margin outlook rises from 14.00 percent in fiscal 2027 to 20.00 percent in fiscal 2029, ET Now reported on September 29, 2026. The broker also raised its fiscal 2027 earnings-per-share estimate by 2.00 percent, fiscal 2028 by 5.00 percent and fiscal 2029 by 19.00 percent.

The upgrade follows a weak first quarter. Revenue from operations fell 5.50 percent year over year to INR 80.7 billion in the first quarter of fiscal 2027, while consolidated net income declined 68.70 percent to INR 4.4 billion, according to ET Now on September 29, 2026. The gross profit margin was 46.50 percent, down 1,039 basis points year over year.

Semaglutide remains the swing factor

The quarterly pressure included a semaglutide-related provision of INR 2.4 billion and weaker lenalidomide sales. Citi expects North America revenue to reach a trough in fiscal 2027, while Abatacept and the resumption of semaglutide supply provide the main milestones behind its more constructive stance.

For investors, the comparison is clear: the latest quarter delivered a 5.50 percent revenue decline, while Citi's forecast points to a 14.00 percent to 20.00 percent margin progression between fiscal 2027 and fiscal 2029. That gap explains why the target increase depends on execution rather than on the latest reported quarter.

Results date is October 23

The next earnings report is scheduled for October 23, 2026, according to Investing.com. The NSE quote was last at INR 1,206.20 on October 1, 2026 at 3:15 p.m. IST, down 2.17 percent from INR 1,233.00, with a 52-week range of INR 1,101.00 to INR 1,414.90.