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Why Cadila Healthcare share price closed over 5% lower today

Cadila Healthcare share which opened at Rs 257 against previous close of Rs 255.30 hit an intra day high of Rs 260.6 (2.08%)

twitter-logo BusinessToday.In        Last Updated: November 4, 2019  | 16:08 IST
Why Cadila Healthcare share price closed over 5% lower today
Cadila Healthcare share price ended 5.42% or 13 points lower at Rs 241.45 compared to previous close of Rs 255.30 on BSE

Cadila Healthcare share price closed lower today after the firm said it received a warning letter issued by the US FDA relating to its Moraiya formulation facility. Cadila Healthcare share price ended 5.42% or 13 points lower at Rs 241.45 compared to previous close of Rs 255.30 on BSE. Cadila Healthcare share which opened at Rs 257 against previous close of Rs 255.30 hit an intra day high of Rs 260.6 (2.08%). However, the stock erased gains after the news about FDA warning letter came in. 

The share went on to hit its intraday low of Rs 233.75, down 8.44% on BSE. However, the stock managed to recover some lost ground to close 5.42% lower on BSE.

The large cap stock has fallen after two days of consecutive gain. On NSE, the stock lost 5.75% to close at Rs 240.80.

Also read: Relaxo Footwears share price rises over 15%, hits all-time high on strong September quarter earnings

The stock has declined 33% during last one year and fallen 31% since the beginning of this year.

The Ahmedabad-based pharma firm said, "It has taken multiple steps after the inspection to address the observations received from US FDA during the inspection. The company will continue to take all necessary steps to ensure that the US FDA is fully satisfied with our remediation of the above facility. We are confident of responding to US FDA to address the observations within the statutory time permitted in the letter."

The firm added, "This warning letter does not affect the existing business of the company in the US and the existing product supplies from the Moraiya facility will continue. Zydus remains committed to patient safety and meeting the expectations of regulatory compliances. After the inspection of Moraiya facility, Zydus Cadila has successfully completed USFDA audits of formulations manufacturing facility at Baddi, and AP manufacturing facilities at Ankleshwar and Dabhasa during the year."

The drug firm is yet to announce its earnings for the second quarter. In the first quarter of current fiscal, the firm reported a consolidated net profit of Rs 303.6 crore for the quarter ended June 30, 2019 compared to net profit of Rs 460.5 crore in the corresponding period of the previous fiscal.

Consolidated total income from operations stood at Rs 3,496.3 crore for the quarter under consideration against Rs 2,893.7 crore in the corresponding quarter last year. The company's India business, which comprises human formulations, consumer wellness and animal health business, posted sales of Rs 1,675 crore for the quarter ended June 2019.

By Aseem Thapliyal

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