The share price of Lupin Pharma rose 3% intraday in the early hours on BSE today after the drugmaker announced that it has entered into an agreement to divest its entire stake in Kyowa to Unison in Japan.
Lupin shares rose 3.15% in early trade and touched an intraday high of Rs 759.15 on the BSE. Later, the stock price fell 1% to the day's low of Rs 727.85 on the BSE. The stock trades in line with the 'Pharmaceuticals' sector, that has fallen 0.34% intraday.
Lupin has moved below its 50-day simple moving average today and already traded lower than 5, 20, 100 and 200-day moving averages.
Market-depth data by BSE suggested 56% selling against 44% buying on the current stock value. Overall, shares amounting to 0.78 lakh and 20.94 lakh were trading on BSE and NSE.
Lupin Pharma stock price has fallen 5.5% in one week and 13% on an year-to-date basis. However, stock price has gained 3.89% value in one month's period.
As per Lupin Pharma's statement on Monday post-market hours, its board approved the stake sale in its Japanese step-down subsidiary. Lupin Pharma has sold the entire stake (99.82%) in its Japanese subsidiary Kyowa to Unison's entity Plutus Ltd, Japan, for an enterprise value of $300 million, subject to closing adjustments.
The company will soon convene an extraordinary general meeting of its shareholders to seek their approval, the filing added.
Post the stake sale, Lupin will not have any equity interest (direct or indirect) and managerial or indirect control over Kyowa. While Lupin is fourth-largest drugmaker in India, Kyowa is Japan's sixth major generic drugmaker.
"The deal proceeds will be utilised to strengthen Lupin's balance sheet as well as provide growth capital to support organic and inorganic initiatives for our focus markets," Vinita Gupta, CEO, Lupin, said.