Dr Reddy's scales 52-week high on buzz over plans to acquire Novartis' India arm

Dr Reddy's is also sitting on surplus cash in its balance sheet to fund any inorganic growth opportunities.

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26 Aug, 2025 12:21

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Shares of Dr Reddy's Laboratories rose over 2 percent and hit a 52-week high of Rs 6,453.95 following a report by CNBC-TV18 that the company is in the race to acquire Novartis AG's stake in Novartis India.

The management of Dr Reddy's has also repeatedly hinted their interest in acquiring a domestic-focused portfolio, in the recent earnings calls.

Switzerland-based pharma giant Novartis AG initiated a strategic review of its subsidiary, Novartis India on February 16. The strategic review will also look over the Novartis AG's 70.68 percent shareholding in its Indian arm.

Dr Reddy's has been involved in strategic partnerships with Novartis India in the past as well. In February 2022, Dr Reddy's signed an exclusive sales and distribution agreement with Novartis which included medicines, such as the Voveran range, Calcium range, and Methergine. In April of the same year, Dr Reddy's acquired the Novartis India's Cidmus brand.

Given that under the existing distribution arrangement which already covers a significant part of Novartis India's portfolio (almost 50 percent of sales) , brokerage firm Nomura believes Dr Reddy's is best place to acquire Novartis AG's stake in its Indian arm.

At 11.01 am, shares of Dr Reddy's were trading at Rs 6,422 on the NSE.

Dr Reddy's had a net cash surplus of Rs 5,900 crore as of December 31, which gives it ample headroom to go ahead with plans of inorganic growth.

The drugmaker has some of its brands in the domestic market last year and are now focused on inorganic opportunities to lead its next leg of growth.

Also Read | Dr. Reddy's eyeing to acquire Novartis' India arm: Report 

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