Ratios run in both directions. One receipt can represent ten ordinary shares when the local share is cheap, or a fraction of one ordinary share when the local share is expensive. The ratio is set at launch and can be changed later by the depositary, which produces a price move that looks exactly like a stock-split but is not one.
Any comparison between the adr price and the local price has to divide by the ratio and convert currency, or the two will look wildly mispriced when they are not.
Example: ratio of 1 ADR to 5 ordinaries. The ordinary trades at 12.40 in local currency worth $1.32 each, so the ADR is worth 5 x 12.40 x 1.32 = $81.84. A ratio change to 1-for-10 would double the receipt price overnight.
Related: adr, gdr, adr-fee, foreign-ordinary-shares, stock-split