February 20, 2024
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Dr. Reddy’s Lining Up Big Acquisition? Shares Jump
Shares of Dr. Reddy’s Laboratories were upbeat on Monday after a report on a TV channel said that the pharma firm was taking part in the bidding process to acquire Novartis AG’s stake in Novartis India.
During recent earnings calls, the management at Dr. Reddy’s has hinted at their keenness to explore opportunities for acquiring portfolios with a domestic focus.
Swiss pharmaceutical titan Novartis AG kickstarted a strategic evaluation of its subsidiary, Novartis India, on February 16. This strategic review encompasses Novartis AG’s 70.68% shareholding in its Indian unit.
Dr. Reddy’s has a long history of strategic collaborations with Novartis India. Notably, in February 2022, Dr. Reddy’s inked an exclusive agreement for sales and distribution with Novartis, encompassing a range of medications including Voveran, Calcium range and Methergine. Subsequently, in April of the same year, Dr. Reddy’s acquired Novartis India’s Cidmus brand.
With the existing distribution agreement already enveloping a significant portion of Novartis India’s product portfolio, covering nearly 50% of its sales, brokerage firm Nomura believes Dr. Reddy’s is ideally positioned to acquire Novartis AG’s stake in its Indian subsidiary.
Having successfully launched several of its own brands in the domestic market last year, Dr. Reddy’s is now strategically focused on leveraging inorganic opportunities to drive its next phase of growth.
Dr. Reddy’s Laboratories’ share price was up 1.68% at ?6,423 in the afternoon session of trade on Monday.
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