Shares of pharmaceutical major Dr Reddy’s Laboratories Ltd declined as much as 6.7% to hit an intraday low of ₹5,371.75 apiece on the BSE on December 11, days after the United States Food & Drug Administration (USFDA) flagged ‘severe’ observation for the company’s Hyderabad plant on Friday.
The scrip opened lower at ₹5,519 on Tuesday, down by 4.2% as against the previous closing price of ₹5,763. At 1:22 pm, the share price of the company was trading 5.52% lower at ₹5,445.45. In contrast to this, the broader BSE Sensex was trading 0.08% or 56.94 points higher at 69,879.12. The company’s market capitalisation stood at ₹90,825.97 crore with 33,460 shares exchanging hands on the BSE as against the two-week average of 7,237 shares.
At present, the share price of the company is trading 89.6% lower than the 52-week high of ₹5,986.20, which the company touched on August 24 this year. The share price of the pharmaceutical major is trading 30.55% higher than the 52-week low of ₹4,176.85, which the company touched on January 25 this year.
In the past one month, six months and one year, the counter has given 0.49%, 16.77% and 23.70% in returns, respectively. In the year-to-date period, the counter has given 28.67% in returns.
"This is to inform that the United States Food & Drug Administration (USFDA) today completed a GMP and Pre-Approval Inspection (PAI) at our R&D centre (Integrated Product Development Organisation or IPDO) in Bachupally, Hyderabad. The inspection was conducted from December 4, 2023 to December 8, 2023. We have been issued a Form 483 with three observations, which we will address within the stipulated timeline," the company says in a regulatory filing.
The development comes months after the company, in July this year, received no observation from the USFDA for its APIs (Active Pharmaceutical Ingredients) facility in Srikakulam, Andhra Pradesh.
In the July to September quarter of FY24, the company’s consolidated net profit surged as much as 33% to ₹1,482.2 crore as against ₹1,142 crore in the same period last year owing to growth in the US generics market. The company’s total revenue in the September quarter stood at ₹6,902.6 crore, witnessing a growth of 9% year-on-year (YoY) as against ₹6,331.8 crore in the same period last year.
Meanwhile, earlier this year in July, Dr Reddy's signed a deal to acquire a 26% stake in special purpose vehicle O2 Renewable Energy IX Private Limited. The company entered into a security subscription and shareholders’ agreement for the consumption and supply of renewable energy, with TEQ Green Power XI Private Limited and O2 Power SG Pte Ltd, for investment in O2 Renewable Energy in the ratio of 26:74. The objective of the deal was to get access to renewable power through solar and wind power plants through the inter-state Transmission System) ISTS under the captive structure.
