Dr Reddy’s shares gain over 1% after Nomura retains ‘Buy’; Rs1,740 target, key biologics milestones ahead

Reports coming in for today mention that Shares of Dr Reddy's Laboratories advanced over 1% on September 28 after Nomura retained its 'Buy' rating and Rs1,740 target price, with the brokerage highlighting key upcoming milestones for the firm's biologics business.

The stock of Dr Reddy's was trading at Rs1,213.60 on the NSE at 9:34 am, up 1.05%.

Nomura stated: "Two key milestones are approaching for Dr Reddy's biologics business: USFDA clearance/EIR for its biologics plant, which we expect in the near term, and the biosimilar Abatacept (intravenous) action date on 18 December 2026. Management is hopeful of a positive outcome."

On the manufacturing facility, Nomura stated the USFDA had inspected both the old and new blocks in June 2026. "The old block inspection focused on remediation implementation, while the new block, which is intended for Abatacept, was inspected for the first time."

"The 90-day period ended on 23 September 2026, so we expect a regulatory response in the near term," the brokerage stated. "Management is hopeful of resolving the outstanding observations and obtaining site clearance."

Nomura additionally noted that Rituximab was approved in August 2026 from the same site. "This suggests the agency may not have serious concern on the facility," it stated.

On Abatacept, Nomura stated: "The firm has been engaging with the USFDA frequently, responding to information requests, and management believes the review is progressing well."

The brokerage further noted: "Management is hopeful of a positive outcome." If approved, "the firm has sufficient capacity for commercial requirements, and we do not expect any scale-up challenges," Nomura stated, noting that the process has been validated through multiple commercial-scale batches.

Nomura stated it remained constructive on biosimilars over the medium to long term. "Large opportunities are emerging as biologics lose exclusivity and regulatory pathways become easier," it stated, while noting that competitive intensity is anticipated to climb but stay below that of small-molecule generics.

Nomura maintained its 'Buy' rating and Rs1,740 target price, based on 24x one-year forward EPS of Rs72.60. The stock trades at 17.4x and 14.6x FY28F and FY29F EPS, respectively.