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Today's prices ask more of Divi's Laboratories than of Dr Reddy's.
At current prices, buyers of Divi's Laboratories are assuming about 31% growth against 8% in its own record; for Dr Reddy's it is 0% against 13%. That shows which share needs more to go right — not which is cheaper. How far each trades from its estimated fair value is in the full valuations.
- Valuation method: Divi's Laboratories on estimate withheld; Dr Reddy's on discounted cash flow.
- Size: Divi's Laboratories is worth about 2.6 times Dr Reddy's on the stock market.
- Record: On revenue the two have grown at much the same pace: Divi's Laboratories compounded at about 13% a year (FY2018–FY2026) and Dr Reddy's at about 11% (FY2018–FY2026).
- What to watch: custom synthesis contracts at Divi's Laboratories; replacing revlimid at Dr Reddy's.
| Divi's Laboratories | Dr Reddy's | |
|---|---|---|
| Price | ₹11,442 | ₹1,380 |
| Market cap | ₹3.03L Cr | ₹1.15L Cr |
| P/E | 90.2 | 41.2 |
| P/B | 18.09 | 3.04 |
| Fair value 🔒 sign in | ₹0,000 | ₹0,000 |
| Upside 🔒 sign in | +00% | +00% |
| Valued on | Estimate withheld | Discounted cash flow |
01Two businesses
The ingredient maker behind global brands
Divi's Laboratories was founded in Hyderabad in 1990 by Dr Murali Divi. It makes active pharmaceutical ingredients (APIs) — the chemical heart of a medicine — for generic drugmakers, and runs custom synthesis for large global pharmaceutical companies, producing ingredients for their patented drugs.
A Hyderabad generics maker with a global footprint
Dr Reddy's Laboratories was founded in Hyderabad in 1984 by Dr K. Anji Reddy. It makes generic medicines for the US, India, Russia and other emerging markets, and active pharmaceutical ingredients that it sells to other drugmakers.
02The records side by side
On revenue the two have grown at much the same pace: Divi's Laboratories compounded at about 13% a year (FY2018–FY2026) and Dr Reddy's at about 11% (FY2018–FY2026). By revenue, Dr Reddy's is about 3.2 times the size of Divi's Laboratories. Divi's Laboratories kept 24.3% of revenue as net profit in FY2026; Dr Reddy's kept 12.3% of revenue as net profit in FY2026 — a sign of very different business models.
Full ten-year tables and charts are on each company's page: Divi's Laboratories · Dr Reddy's.
03What each price assumes
Work backwards from each share price and you can see what buyers are taking for granted — the rate each company must sustain to justify what it costs, against what its own record supports.
04What decides each one's value
- Custom synthesis contractsLong-term work for global innovators is the highest-value part of the business.
- Generic API volumesPrices for generic APIs follow global supply, including from China.
- Replacing RevlimidNew US launches and other markets need to fill the gap left by one very profitable product.
- US generic pricingPrices for older generics keep falling, so the pipeline has to keep moving.
05What could go wrong
- Chinese competitionCheaper Chinese APIs can pressure prices.
- Customer concentrationA few large contracts matter a lot.
- FDA inspectionsAdverse findings at a plant can block US approvals and shipments.
- Pipeline delaysLate approvals push out the launches that replace lost profit.
06Which is better value?
Sign in free to see which trades further below its worth
- ✓Both fair values per share — each on the method that fits the business
- ✓Every step of both workings — growth, margins and cost of capital, with sources
- ✓Bull, base and bear cases — for each company
- ✓Downloadable reports — the full write-up for each, yours to keep
08Questions people ask
Is Divi's Laboratories or Dr Reddy's better value?
That turns on how far each share trades from its estimated fair value. Both figures, with every step of the working, are in the full valuations, free to view once you sign in. On the public numbers, Divi's Laboratories trades at 90.2 times earnings and 18.09 times book value, and Dr Reddy's at 41.2 times earnings and 3.04 times book value — but multiples alone mislead when two businesses work differently, which is why each is valued on the method that fits it.
What is the difference between Divi's Laboratories and Dr Reddy's?
Divi's Laboratories was founded in Hyderabad in 1990 by Dr Murali Divi. Dr Reddy's Laboratories was founded in Hyderabad in 1984 by Dr K.
Are Divi's Laboratories and Dr Reddy's valued the same way?
No. Divi's Laboratories is valued on estimate withheld and Dr Reddy's on discounted cash flow, because forcing one model onto both would misstate at least one of them.
What does today's price assume for Divi's Laboratories and Dr Reddy's?
Worked backwards from the share price, Divi's Laboratories needs about 31% growth and Dr Reddy's about 0% growth, against 8% and 13% in their own records.