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Divi's Lab drops as US drug regulator issues warning letter

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Capital Market
Last Updated : Apr 24 2017 | 10:28 AM IST

Divi's Laboratories lost 1.12% to Rs 624.10 at 10:03 IST on BSE after the company said that US drug regulator has issued a warning letter for its unit at Visakhapatnam.

The announcement was made on Saturday, 22 April 2017.

Meanwhile, the S&P BSE Sensex was up 159.45 points or 0.54% at 29,524.75.

On the BSE, 1.63 lakh shares were traded on the counter so far as against the average daily volumes of 2.55 lakh shares in the past one quarter. The stock had hit a high of Rs 627.50 and a low of Rs 607 so far during the day.

The stock had hit a record high of Rs 1,380 on 16 September 2016 and a 52-week low of Rs 611.60 on 22 March 2017. It had underperformed the market over the past one month till 21 April 2017, sliding 0.5% compared with the Sensex's 0.41% fall. The scrip had also underperformed the market over the past one quarter, declining 11.6% as against the Sensex's 8.62% rise.

The large-cap company has equity capital of Rs 53.09 crore. Face value per share is Rs 2.

Divi's Laboratories has updated that the United Food and Drug Administration (USFDA) has issued a warning letter for the company's unit-II at Visakhapatnam. The company responded to the USFDA inspection observations with an appropriate remediation process to overcome the deficiencies observed.

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As part of the company's commitments, it also provided periodic updates to the USFDA. In the import alert issued, USFDA has exempted several products manufactured at the company's unit-II at Visakhapatnam, Andhra Pradesh.

The company will continue to supply these active ingredients to meet its obligations to customers. Divi's Labs, along with external consultants and subject matter experts, are working to address the concerns of the USFDA and is making all efforts to fully meet the compliance requirements. The company will respond to this warning letter with a detailed plan within the stipulated time.

Divis Laboratories' net profit rose 8.7% to Rs 268.32 crore on 13.4% increase in net sales to Rs 973.44 crore in Q3 December 2016 over Q3 December 2015.

Divi's Laboratories is primarily engaged in the manufacture of active pharmaceutical ingredients (APIs) & intermediates for generics; custom synthesis of API's and advanced intermediates for discovery compounds for pharma giants; building blocks for peptides; building blocks for nucleotides; carotenoids; and chiral ligands.

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First Published: Apr 24 2017 | 10:04 AM IST

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