Cipla scales new 52-week high at Rs 1256.90

Our Markets Bureau

Mumbai, Aug 28: WITH the new economy sector stocks being dumped by investors and fund managers, their focus and concentration is now more on pharma stocks. Thus, after the recent spurt in prices of Dr Reddy’s Lab (DRL) and Ranbaxy Lab Limited (RLL) another leading pharma company -- Cipla Ltd -- has been in the limelight since past few trading sessions.

Sustained buying interest on the Cipla counter pushed the stock prices to its year’s high on Tuesday. The stock, which hit a 52-week high of Rs 1,244.80 on Monday, recorded a fresh 52-week high of Rs 1,256.90 in morning trades on Tuesday. However, the stock prices came under selling pressure after the mid-session and closed at Rs 1225.70.

At BSE, 2.24 lakh shares were traded valued at Rs 27.73 crore.
As compared with current closing price on Tuesday, the stock price has jumped 13.5 per cent in the last four trading sessions from Rs 1,097.90 on Aug 21, 2001 to the current Rs 1,225.70.

Analysts feel that the upbeat trend in Dr Reddy’s Laboratories (DRL) and Ranbaxy Laboratories (RLL) in the last few trading sessions has spilled over onto Cipla counter. DRL and RLL have been in the limelight over the last couple of months on the strength of their good Q1 ended June 2001 results and positive developments related to launch of new drugs in the overseas markets.

DRL also got a boost from the receipt of royalty recently from US pharma major Novartis in relation to an anti-diabetic drug.
Cipla has gained much renown in the pharmaceutical sector for its anti-AIDS drugs. The company recently launched its single bi-layered tablet that has a combination of three anti-AIDS drugs - lamivudine, stavudine and nevirapine - and which is expected to help in treating a larger number of AIDS patients as it is less expensive and also reduces the pill burden.

The company has frequently reduced the prices of anti-AIDS drug to counter competition. In July 2001, it also entered into a venture for supplying its AIDS triple-drug therapy to the Nigerian government. Cipla is one of the lowest cost producers of anti-AIDS, anti-infective and anti-asthmatic drugs.

For the first quarter ended June 2001, the company posted a disappointing result with a lower than expected rise in net profit of 14 per cent to Rs 44.4 crore on sales growth of 23 per cent to Rs 297.89 crore.