Dr. Reddy’s Faces Tax Reassessment Order Post-Merger

Dr Reddy’s Laboratories ( (RDY) ) has shared an update.

On May 31, 2025, Dr. Reddy’s Laboratories received an order from the Income Tax Authority under Section 148A(3) of the Indian Income Tax Act, following a previous notice on April 4, 2025, regarding the reassessment of returns for the financial year 2019-2020. This development stems from the merger of Dr. Reddy’s Holding Limited into Dr. Reddy’s Laboratories, which was approved by the National Company Law Tribunal in 2022. Despite a proposed tax demand of approximately Rs. 2395.82 crore, the company believes there is no tax escapement and foresees no material impact on its financials or operations. The company is reviewing the order and plans to take appropriate actions, with an indemnity clause in place to protect against liabilities arising from the merger.

The most recent analyst rating on (RDY) stock is a Buy with a $17.40 price target. To see the full list of analyst forecasts on Dr Reddy’s Laboratories stock, see the RDY Stock Forecast page.

Spark’s Take on RDY Stock

According to Spark, TipRanks’ AI Analyst, RDY is a Outperform.

Dr Reddy’s Laboratories receives a solid overall score due to its strong financial performance, especially in revenue growth and balance sheet stability. Technical indicators show positive momentum, although the stock is below its long-term average. Valuation is reasonable, but dividend yield is low. The recent earnings call was positive, highlighting growth and strategic advancements despite some market challenges.

To see Spark’s full report on RDY stock, click here.

More about Dr Reddy’s Laboratories

Dr. Reddy’s Laboratories Limited is a pharmaceutical company based in Hyderabad, India. The company is involved in the manufacturing and marketing of a wide range of pharmaceutical products and services, with a focus on generic medications and active pharmaceutical ingredients.

Average Trading Volume: 2,041,293

Technical Sentiment Signal: Strong Buy

Current Market Cap: $12.2B

Learn more about RDY stock on TipRanks’ Stock Analysis page.