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Singapore: P.V. Ramaprasad Reddy, the co-founder of Indian drugmaker Aurobindo Pharma Ltd, is a billionaire as the stock more than tripled in the past year to a record.

Reddy and his wife, Suneela Rani, control about 38% of Aurobindo Pharma, according to a 26 May filing to the Bombay Stock Exchange. Excluding shares pledged as collateral, their interest in the drugmaker is valued at more than $1 billion, according to the Bloomberg Billionaires Index.

Investors are betting on increased sales after the US health regulator approved its generic version of Cymbalta antidepressant in December. Its acquisition of Dublin-based Actavis Plc’s commercial operations in seven European countries this year also gives it scale and access to other markets, said Ranjit Kapadia, an analyst at Centrum Broking Pvt.

There is a rerating that has happened, said Mumbai- based Kapadia, who has a buy recommendation on the stock. There is an expectation of good results.

The Hyderabad-based drugmaker’s share price more than tripled in the last 12 months to close at a record Rs642.45. Aurobindo Pharma plans to announce its earnings for the year ended 31 March at the end of the week, it said in a statement to the stock exchange.

Tathagato Roychoudhury, who oversees Aurobindo Pharma’s investor relations in the southern Indian city, said Reddy is a billionaire based on the value of his shares and those held by his wife. He said he’s unable to provide details of Reddy’s personal assets as he could only comment on the company.

Share transfer

Reddy owns 6.7% of the drugmaker and his wife has 31.2% stake, according to the 26 May filing. He gave 60 million of his shares — representing a 20.6% stake — to his wife in 2012, according to an exchange filing then.

The 55-year-old held management positions in various pharmaceutical companies before setting up Aurobindo Pharma in 1986 with K. Nityananda Reddy and a group, according to the drugmaker’s website. It started operations about two years later with one facility manufacturing semi-synthetic penicillin.

Aurobindo Pharma went public in India in 1995. It broadened its suite of drugs, including cardiovascular, anti-retroviral, gastroenterological and anti-diabetic treatments. It also branched out into higher-margin, specialty drugs.

More than 70% of the drugmaker’s revenue comes from its overseas operations as it exports to more than 125 countries, according to its website. The manufacturing cost of Indian drugmakers is as much as 65% lower than that of US firms and almost half of those in Europe, the company said in its latest annual report.

Technologically they are highly competent so they can make all the complex molecules, said Centrum Broking’s Kapadia. They are also efficient in marketing their drugs in the US and European countries. BLOOMBERG

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