Alembic Pharmaceuticals Ltd shares jumped as much as 3.5 per cent in early trade on Wednesday after the company said it has entered into a joint venture (JV) agreement with Chinese companies to foray into China, the world’s second largest drug market after the US.
Alembic Pharmaceuticals is also going to announce its March quarter earnings later in the day. According to Motilal Oswal, Alembic Pharmaceuticals is likely to report 2.6 per cent fall in its Q4 net profit to Rs 91.3 crore, while sales are expected to rise 10.8 per cent year-on-year to Rs 945.2 crore. The stock was trading at Rs 555, up 1 per cent, at 11:45 am on BSE after trimming its early gains.
Alembic Pharma has signed a joint venture with SPH SINE Pharmaceutical Laboratories Co Ltd and Adia (Shanghai) Pharmaceuticals Co Ltd to promote and sell pharmaceutical products for the Chinese market, as per the company’s filing on BSE.
SPH Sine will be the biggest stakeholder in the joint venture with 51 per cent stake, Alembic will hold 44 per cent share, while Adia will hold 5 per cent equity.
The JV will initially commercialize products manufactured by Alembic Pharmaceuticals in China and later plans to set up a manufacturing facility in the country. It plans to start operations in China by launching a portfolio of oral solids and is then expected to foray into other areas like injectables, ophthalmology, dermatology and oncology.
The registered capital of the new company will be 1 million Chinese yuan (approximately Rs 1 crore). The agreement was signed at Alembic Pharmaceuticals’s Vadodara headquarters.
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