Sun Pharma rises 6% after replacing domestic formulations distributor with its own subsidiary

Shares of Sun Pharmaceuticals Tuesday surged over 6 per cent after it replaced its domestic formulations distributor Aditya Medisales with its own subsidiary in the backdrop of a second whistleblower complaint filed against the company.

On BSE, the stock gained 6.12 per cent to Rs 422.75.

Similarly, on NSE, the stock rallied 6.32 per cent to its intra-day high of Rs 423.50.

The stock closed with nearly 2 per cent gains on Monday.

"Sun Pharma's distribution related to India's domestic formulations business shall be transitioned from Aditya Medisales Ltd., the current distributor, to a wholly-owned subsidiary of Sun Pharma," the company said in a regulatory filing.

Sun Pharma said this change will be made effective by first quarter of 2019-20, post receipt of all requisite regulatory approvals.

The company also announced unwinding of a transaction amounting to Rs 2,238 crore with Atlas Global Trading and initiated steps to induct S R B C & Co LLP, its statutory auditors, as auditors of subsidiaries.

Last week, Sun Pharmaceutical asked markets regulator Sebi to look into the issues of certain entities and individuals allegedly adopting unfair trade practices prejudicial to the company's shareholders.

Amid reports that a second whistleblower complaint has been filed against it and shares taking a beating on the exchanges, Sun Pharma had written to Sebi flagging concerns that certain entities were allegedly adopting unfair trade practices.