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India's Ranbaxy shares weaken after China sale

India's Ranbaxy shares weaken after China sale

Shares in India's biggest drugmaker Ranbaxy Laboratories fell in morning trade yesterday after the group said it had sold its stake in its high-profile Chinese joint venture.
Ranbaxy announced Tuesday that it had agreed to sell its stake in Ranbaxy Guangzhou China Ltd to the state-owned Chinese firm HNG Chembio Pharmacy Co. Ltd for an undisclosed amount.
The move was part of plans to develop a new business model for China, where it will continue to supply medicines from its other plants, the firm said.
"China continues to be an important market for Ranbaxy and the company believes that this new approach will create greater value," it added in a statement released Tuesday.
Shares were down 0.44 percent in midmorning trade at 518.25 rupees, off a low of 515.00, in a broadly weaker market.
Ranbaxy Guangzhou China Ltd was a joint venture between the Ranbaxy group, Guangzhou Baiyunshan Pharmaceutical Company Limited and Hong Kong Chemic and was considered one of India's most high-profile investments in China.
In October, the branded and generic drugs maker, controlled by Japan's Daiichi Sankyo, posted a third-quarter profit of 1.16 billion rupees (US$25 million) after a loss in the same period in 2008.
The company's financial year runs from January to December.
But the company said it still expected a net loss of 8.0 billion rupees in the calendar year after poor earnings linked to major regulatory problems in its largest market, the United States.


Updated : 2021-03-05 03:50 GMT+08:00