Divi’s Labs slips over 6% after getting USFDA observations on Visakhapatnam plant

NEW DELHI: Shares of Divi’s Laboratories declined as much as 6.28 per cent in early trade on Thursday, after the company informed the bourses that the US health regulator has made five observations after an inspection of its manufacturing plant at Visakhapatnam in Andhra Pradesh.

Shares of the drug firm were trading 2.66 per cent down at Rs 1,132 in early trade at around 10 am. The scrip opened the day at Rs 1,129 and touched a high and low of Rs 1,138 and Rs 1,090, respectively, in trade so far. The benchmark BSE healthcare index was trading 0.21 per cent higher at 15,440.

In a BSE filing, the company said, “Unit-II at Visakhapatnam, Andhra Pradesh has had an inspection by the US Food and Drug Administration (USFDA) from November 29 to December 6. We have been issued a form 483 with five observations and these shall be responded within the time permitted."

In the past one year, share price of the company has advanced 3 per cent to Rs 1,163.70 till December 7. The scrip hit 52-week high of Rs 1,380 on September 16, 2016 and 52-week low of Rs 918.10 on February 29, 2016.

For the quarter ended September 30, 2016, the company reported a net profit of Rs 223.85 crore, down 24.31 per cent from Rs 295.73 crore reported for the corresponding quarter last year. Revenue of the company increased 4.26 per cent year-on-year to Rs 1,005.43 crore during the quarter under review.

The company is engaged in the business of manufacturing active pharmaceutical ingredients (APIs) and intermediates for generics among others at the manufacturing plant.