Drug major Novartis AG has initiated a strategic review of Novartis India Ltd amid reports of putting the India listed business on the block.
"Novartis AG has commenced the strategic review that will include an assessment of its 70.68% shareholding in Novartis India Limited," a Novartis India spokesperson told NDTV Profit. "No decision has yet been taken regarding the eventual outcome. In the meantime, it is business as usual."
Media reports suggest that drugmaker Dr. Reddy's Laboratories Ltd. is in the race to acquire the Novartis AG's stake in Novartis India. Dr. Reddy's declined to comment on NDTV Profit's emailed queries.
In February 2022, the company entered into an exclusive sales and distribution agreement with Dr Reddy's for a few of its established medicines, which include the Voveran® range, the alcium range and Methergine to further broaden access to these medicines beyond the current geographies.
"The combined approach of our focus on collaboration and different business models on ensuring wider access to our medicines has allowed your company to improve volume growth and operating margins. Volume growth of our portfolio distributed by Dr. Reddy's was double digit," Novartis India said in its annual report of 2022-23.
Novartis India reported a net profit of Rs 26.5 crore for the quarter ended December 2023 from Rs 7.6 crore on-year. Its revenue from operations stood at Rs 84.5 crore from Rs 80 crore in the October-December quarter of the last fiscal.
For FY23, its pharma business registered revenue of Rs 378 crore, a m 5% decline over the previous year. Its profit stood at Rs 103 crore during the year.
Shares of Novartis India, with a market capitalisation of Rs 2,556 crore, closed over 13% higher on Friday at settle at Rs 1,035 per share on the BSE as compared to 0.5% rise in benchmark Sensex. The stock has rallied over 72% in the past year.
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