Global brokerage Citi slashed price target to Rs 2,375 from Rs 2,540 per share, citing likely more delay in female contraceptive drug launch after fresh Complete Response Letter from US FDA.
Shares of Dr Reddy's Laboratories fell 8 percent intraday on August 14 as there could be a delay in the launch of the generic female contraceptive drug in the US.
The Hyderabad-based drugmaker in its August presentation said it has received a Complete Response Letter from the US Food and Drug Administration for its generic version of Copaxone and NuvaRing
Copaxone is used to prevent the relapse of multiple sclerosis and NuvaRing is a vaginal ring used to prevent pregnancy.
The company said it is preparing for response to the letter given by the US drug regulator.
The US FDA sends the applicant a complete response letter if the agency determines that it will not approve the application or abbreviated application in its present form for one or more of the reasons.
Global brokerage Citi has maintained its sell rating on the stock and slashed price target to Rs 2,375 from Rs 2,540 per share, citing likely more delay in female contraceptive drug launch after fresh Complete Response Letter from US FDA.
The research firm cut its FY20/21/22 EPS estimates by 8/6/1 percent assuming the launch of generic NuvaRing in mid-2020.
"Nuvaring launch before mid CY20 is unlikely and further delay can't be ruled out," Citi said.The stock was quoting at Rs 2,501.70, down Rs 56.30, or 2.20 percent on the BSE at 1332 hours IST.Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.