Cipla share price trades marginally higher after its European subsidiary acquired additional stake in Cipla Maroc SA | Mint
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Business News/ Markets / Stock Markets/  Cipla share price trades marginally higher after its European subsidiary acquired additional stake in Cipla Maroc SA
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Cipla share price trades marginally higher after its European subsidiary acquired additional stake in Cipla Maroc SA

The Cipla stock, which opened at ₹1,199 apiece on November 28, rose 0.27% during intraday to ₹1,2020 per share.

The Cipla stock opened at ₹1,199 apiece on November 28, rose 0.27% during intraday to ₹1,2020 per share. (REUTERS)Premium
The Cipla stock opened at 1,199 apiece on November 28, rose 0.27% during intraday to 1,2020 per share. (REUTERS)

The share price of Cipla was trading marginally higher in the early morning session on Tuesday. The Cipla stock, which opened at 1,199 apiece on November 28, rose 0.27% during intraday to 1,2020 per share.

The stock surged after its European subsidiary Cipla EU successfully completed the acquisition of an additional share in Cipla Maroc SA, a joint venture based in Morocco.

Cipla EU has acquired an additional 15.1% stake in Cipla Maroc SA, Morocco shares, from The Pharmaceutical Institute (PHI) for MAD 81.1 million, approximately $8.05 million.

Consequently, Cipla EU's ownership in the joint venture company will now reach 75.10%, with Societe Marocaine de Cooperation Pharmaceutique (Cooper Pharma) holding the remaining 24.90% stake.

On November 17, Cipla received a Warning Letter (WL) from the US FDA for its Pithampur plant in Indore, citing concerns related to Albuterol inhaler manufacturing, contamination incidents, document disposal procedures, and repeat observations across multiple sites.

The US FDA letter specifically highlighted data integrity issues at Cipla, stemming from a routine good manufacturing practices inspection conducted at the Pithampur facility in February 2023. Cipla had received eight inspectional observations in Form 483.

Jefferies's analysts noted that the first two issues were associated with manufacturing processes, while the third pertained to data integrity. The brokerage's analysis revealed that 47% of import alerts result from data integrity issues (such as manipulating, overwriting, or falsifying data), 37% from product and quality issues, 10% from concealing information from regulators, and 7% from repeat observations.

The shares of Cipla have plunged over 4% in the past week and underperformed the benchmark over the last month. Cipla hit a 52-week high of 1,283.55 on November 22, 2023, however, the stock fell 6.8 percent after the warning letter from USFDA.

On November 17, the United States Food and Drug Administration (USFDA) issued a warning letter to Cipla regarding its facility in Pithampur, Indore. The letter outlined concerns related to the manufacturing of Albuterol inhalers, instances of contamination, procedures for document disposal, and recurrent observations noted at various sites.

Cipla recorded a 14.5% year-on-year increase in net revenue, climbing from 5,828 crores in Q2FY23 to 6,678 crores in Q2FY24. Additionally, net profit witnessed a 43% year-on-year surge, advancing from 789 crores in Q2FY23 to 1,130 crores in Q2FY24.

 

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Published: 28 Nov 2023, 04:00 PM IST
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