Strides Arcolab shares sink on dividend worries

Feb 28 2013, 10:01 IST
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Shares in Indian drugmaker Strides Arcolab plummeted about 10 percent on Thursday. (Reuters) Shares in Indian drugmaker Strides Arcolab plummeted about 10 percent on Thursday. (Reuters)
SummaryShares in Indian drugmaker Strides Arcolab plummeted about 10 percent on Thursday.

Shares in Indian drugmaker Strides Arcolab plummeted about 10 percent on Thursday, wiping out early gains following its sale of a unit to Mylan for $1.6 billion, as investors were unhappy with Strides' dividend payout, traders said.

The shares had initially gained as much as 13.2 percent.

The company declared a 20 percent dividend, or 2 rupees per share, for 2012.

Strides' injectables unit Agila Specialties generated $700 million in sales and an operating profit of $86 million in year 2012, Strides said.

The Bangalore-based drugmaker said it planned to spend $700 million to $800 million at pretax level on shareholders.

Valued at $1.1 billion, shares in Strides Arcolab were down 9 percent at 896.15 rupees by 0411 GMT when the Mumbai market was up 0.55 percent.

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