Strides Arco strides ahead
Strides Arcolab has seen a fantastic run on the markets since the last 15 days. On 1st August, the stock had hit a new low at Rs.552.65 and today, it is at Rs.817.75, a rise of almost 50%. Its market cap stands at Rs.4832 crore.
The stock is up after the Prime Minister cleared the Rs.9920 crore FDI from Mylan Inc, overruling the concerns raised by Department of Industrial Policy and Promotion (DIPP) and Ministry of Health. Now, the deal will be brought to the Cabinet Committee on Economic Affairs (CCEA) under existing policy to get the final approval.
Foreign Investment Promotion Board (FIPB) had kept its approval on the deal in abeyance till there was clarity on “brownfield” FDI norms where acquisition is built into a new project. DIPP voiced concerns that brownfield investment in pharmaceuticals will hurt domestic companies. Concerns have also been raised that Mylan may steer cancer drugs made in India to the US market thus reducing domestic availability.