Sanofi India Ltd’s share price took a beating in response to litigation threats and a cancer drug development setback. The finance chief of the pharmaceutical company said on Wednesday that a decline was strongly exaggerated and posed a buying opportunity for savvy investors.
Sanofi India is engaged in the business of manufacturing and sale of pharmaceutical products. The company offers innovative solutions in preventive healthcare (vaccines) and treatment for allergies, pain, diabetes, and rare diseases. The company has a very good dividend yield of 7.77%. In fact, it recently declared a special dividend and an interim dividend at the rate of 1930% each.
The company was testing an amcenestrant on women with newly diagnosed advanced breast cancer, however, the trial was stopped early because an independent monitoring panel found no signs of it working. According to a report by the news agency Reuters, this trial failure dealt a major blow to the French healthcare company’s development prospects.
Another factor that has been weighing on Sanofi’s shares recently is a lawsuit over the heartburn drug Zantac. Sanofi was among a few companies that were selling Zantac. However, US regulators pulled it from the market in 2020. The plaintiff in the first lawsuit over the drug agreed to drop his case on Tuesday.
The share price of the company fell by 0.65% on Monday’s early trades to reach a fresh 52-week low of 6295.00. Further, its share price fell by 6.80% in the past month. The shares are currently trading at 6300.00.
Centrum Broking gave a buy call on the shares of Sanofi India on July 28, 2022, with a target price of ₹ 8,500. This translates to an upside of 34.92%.
Written by Simran Bafna
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