Pfizer India stocks rise 6 per cent on infant nutrition business sale news
The news of Pfizer selling its infant nutrition business to Nestle for $11.85 billion send its Indian unit's shares up by about 6% in intra-day trade on Monday.
NEW DELHI: The news of Pfizer selling its infant nutrition business to Nestle for $11.85 billion send its Indian unit's shares up by about 6% in intra-day trade on Monday.
The scrip, which rose on investor expectations that the American drugmaker would offer a special dividend after exiting the non-core business, closed 0.05% up at Rs 1,347 on the Bombay Stock Exchange, where the main index ended down 1.6%.
A spokesman for Nestle India, however, said it was pre-mature to comment on the deal's impact on the company's local operations, as the transaction is subject to regulatory approval in different jurisdictions. Shares in Nestle India closed 1.85% down on the BSE at Rs 4,885.2.
"In the short-term, the deal may not have a major impact on Nestle's India operations," Anand Mour, senior FMCG analyst at financial services firm Ambit Capital said. However, he added that since India and China are rapidly growing economies, Nestle can enhance its growth in the region.
The deal is unlikely to have any direct financial impact on Pfizer's Indian unit, as it does not have any operations in the nutritional business in the country. Analysts now expect Pfizer to complete the sale of its animal health business soon.
"Now, the sale of the animal health division is expected soon and the company may give dividend to shareholders," said Ranjit Kapadia, senior vice-president at Centrum Broking.
Mumbai-based Pfizer India has a cash pile of Rs 700 crore. In February, the company hived off its animal health division into a wholly-owned subsidiary to facilitate the global sale of the division.
"We are present in Hong Kong, China, Taiwan, Singapore, Malaysia, Indonesia, Thailand and Philippines. We reported good profit figures in 2011 and 85% of our revenue is from the emerging markets," said Pfizer India spokesperson Priya Chandramohan.
The scrip, which rose on investor expectations that the American drugmaker would offer a special dividend after exiting the non-core business, closed 0.05% up at Rs 1,347 on the Bombay Stock Exchange, where the main index ended down 1.6%.
A spokesman for Nestle India, however, said it was pre-mature to comment on the deal's impact on the company's local operations, as the transaction is subject to regulatory approval in different jurisdictions. Shares in Nestle India closed 1.85% down on the BSE at Rs 4,885.2.
"In the short-term, the deal may not have a major impact on Nestle's India operations," Anand Mour, senior FMCG analyst at financial services firm Ambit Capital said. However, he added that since India and China are rapidly growing economies, Nestle can enhance its growth in the region.
The deal is unlikely to have any direct financial impact on Pfizer's Indian unit, as it does not have any operations in the nutritional business in the country. Analysts now expect Pfizer to complete the sale of its animal health business soon.
"Now, the sale of the animal health division is expected soon and the company may give dividend to shareholders," said Ranjit Kapadia, senior vice-president at Centrum Broking.
ADVERTISEMENT
Mumbai-based Pfizer India has a cash pile of Rs 700 crore. In February, the company hived off its animal health division into a wholly-owned subsidiary to facilitate the global sale of the division.
"We are present in Hong Kong, China, Taiwan, Singapore, Malaysia, Indonesia, Thailand and Philippines. We reported good profit figures in 2011 and 85% of our revenue is from the emerging markets," said Pfizer India spokesperson Priya Chandramohan.
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
Related Articles
Stocks to buy: M&M, Federal Bank and Pfizer India on investors' radarADVERTISEMENT
