 "Novartis India soars 11% as parent intents to conduct strategic review")
Shares of Novartis India hit a multi-year high of Rs 1,148, as they rallied 11 per cent on the BSE in Monday’s intra-day deals after the parent firm announced its intention of a strategic review.
In past three months, the stock of pharmaceutical company has zoomed 65 per cent. It had hit a record high of Rs 1,436.35 on December 6, 1999.
Novartis India in an exchange filing said the Board took note of the communication received from Novartis AG, Holding Company & Promoter, regarding their intention to conduct a strategic review to unlock value of their shareholding in the company. Novartis AG held 70.68 per cent stake in Novartis India.
After some deliberations, the board agreed to support Novartis AG, as may be required, in evaluating their strategic options, the company said. Novartis India is primarily engaged in the business of trading of pharmaceuticals.
Medicine spending in India is projected to grow 9-12 percent over the next five years, leading India to become one of the top 10 countries in terms of medicine spending. The company in its FY23 annual report said that it is witnessing, Tier 2 and 3 towns are playing a pivotal role in India’s flourishing economy. As per the National Council of Applied Economic Research’s (NCAER) estimation by 2025, the contribution of Tier 2 and 3 cities will escalate to 45 percent by 2025, proving that even the underdogs can triumph against all odds.
According to media report, Dr Reddy's Laboratories is likely in a race to acquire Novartis AG's stake in Novartis India. Dr Reddy's plans to acquire the domestic-focused portfolio and may offer controlling premium, CNBCTV18 reported quoting sources.
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However, Dr Reddy’s clarified that the company does not comment on market speculations and there is currently no such event or information which requires a disclosure. The company makes prompt disclosures, as and when any event or information is considered material or warrants such disclosure, Dr Reddy’s said.
Meanwhile, shares of Dr Reddy’s Laboratories hit a record high of Rs 6,452.30, up 2 per cent on the BSE in intra-day trade today. In past one month, the stock outperformed the market by surging 15 per cent, as compared to 1.5 per cent rise in the S&P BSE Sensex.
