Moneycontrol Bureau
Shares of Strides Arcolab surged 3 percent intraday on Friday after Macquarie has included its top small-cap pick in India with a target price of Rs 950. The brokerage feels that its dividend could be a near-term catalyst and is positive that generic business will deliver strong growth going forward driven by market share ramp-up of recent launches.
"During the last earnings call, Strides Arcolab had highlighted that from USD 390 million of receivables from Mylan, it expects contingent holdback (of USD 250 million) to get released in Q2 FY15. With 20 days left for Q2FY15 end, dividend could be a near-term catalyst," it said in a report.
After retaining USD 50 million for the Biotech business, the drug company intends to distribute the remaining cash (post tax) as dividends. USS 40 million of regulatory escrow will be released post full resolution of FDA issues by Mylan and USD 100 million of tax escrow after three years.
At 10:55 hrs Strides Arcolab was quoting at Rs 730.20, up Rs 10.90, or 1.52 percent on the BSE.
Posted by Nasrin Sultana
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