Lupin denies plans to sell India unit, shares edgy
Following the reports of Lupin, the fourth-largest domestic drug maker by revenue, planning to sell its Indian formulation business, the shares of the company remained volatile on Tuesday.business Updated: Jul 19, 2011 21:08 IST
Following the reports of Lupin, the fourth-largest domestic drug maker by revenue, planning to sell its Indian formulation business, the shares of the company remained volatile on Tuesday.
Shares of the company opened at Rs 481.9 and touched an intra day high of Rs 482.5, then touched the day's low of Rs 477 before closing at Rs 478.5 on the Bombay Stock Exchange. It was reported on Tuesday that the company is scouting for buyers to sell its India business, which contributes 30% of the company's revenue of Rs 5,706 crore in 2010-11. Revenue from India business was Rs 1,573 crore as on March 31, 2011.
Piramal Healthcare, last year sold its domestic formulation business, known as healthcare solution business, to global drug major Abott for Rs 17,000 crore.
However, Lupin denied such reports and said there are no plans for selling any of its business. "We do not intend to sell our India business or any other business vertical of the company" said the company's official spokesperson.
More and more global drug makers are eying Indian drug manufactures for increasing their footprint in Indian pharmaceuticals market that is expected to expand by about 14.5 % annually to reach $55 billion by 2020, according to McKinsey & Co.
Analysts value the company at around 7-8 times of its annual revenue. "Going by Lupin product portfolio and its reach, the company commands a valuation of around 7-8 times of its yearly revenue," said a senior pharma analyst with a broking house.