Here's why Dr. Reddy's share slipped 8%, hit 52-week low on Monday, April 7

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Dr. Reddy’s share price: Pharmaceutical company Dr. Reddy’s Laboratories (Dr. Reddy’s) share slipped as much as 7.55 per cent to hit an intraday low of Rs 1,025.90 per share. 

 

The fall in Dr. Reddy’s share price came after the company announced that it received approximately Rs 2,395-crore show cause notice from I-T department.

 

In an exchange filing, Dr. Reddy’s said, “This is to inform that the Company has received a notice on 4th April 2025, from the Office of the Assistant Commissioner of Income Tax, circle 8(1), Hyderabad under sub section 1 of Section 148A of the Indian Income Tax Act, 1961 (‘Act), requiring to show cause as to why the returns for the Assessment Year 2020-21 (Financial Year 2019-2020) should not be reassessed under Section 148 of the Act.”

  The exact figure of the show cause notice stands at Rs 2395,81,79,470, the company said. 

According to the notice, Dr. Reddy’s expected to respond as to why notice u/s 148 should not be issued for assessment of income alleged to be escaped from tax consequent to the merger of Dr. Reddy’s Holding Limited(DRHL) into Dr. Reddy’s Laboratories Limited (DRL) under the scheme of amalgamation approved by the National Company Law Tribunal (NCLT), Hyderabad on April 5, 2022.   ALSO READ | Stock Market Crash LIVE: Sensex 2,900 pts lower at 72,450; BSE m-cap drops by ₹20 trn intra-day

 

“The Company strongly believes that there is no escapement of tax pursuant to the said merger scheme. Nonetheless the Company is reviewing the information and clarifications required in the Show cause notice and will respond, as required, appropriately.” Dr. Reddy’s said.

 

Based on its assessment, Dr Reddys also said that there is no material impact on the financials, operations, or other activities of the company at this stage.

 

About Dr. Reddy’s

 

Dr. Reddy’s Laboratories, founded in 1984 by Dr. Kallam Anji Reddy, is a global pharmaceutical company headquartered in Hyderabad, India. 

 

Dr. Reddy's focuses on the manufacture and marketing of a wide range of products, including prescription and over-the-counter pharmaceuticals, active pharmaceutical ingredients (APIs), and intermediates. 

 

Over the years, the company has expanded its reach globally, with operations spanning the US, Europe, Latin America, and Asia, providing healthcare solutions to a diverse customer base.  ALSO READ | Why are metal stocks falling? Lloyds Metals, SAIL, HZL, Nalco dip up to 18%

 

Dr. Reddy's product portfolio includes generic drugs, branded generics, biosimilars, and differentiated formulations. The company is also deeply involved in the manufacturing and marketing of APIs. It focuses on a broad range of therapeutic areas, such as gastroenterology, cardiovascular health, diabetology, oncology, pain management, and dermatology.

 

The market capitalisation of Dr. Reddy’s is Rs 91,093 crore , according to BSE. The company falls under the BSE 100 category. 

 

At 11:13 AM, Dr. Reddy’s share was trading 1.63 per cent lower at Rs 1,091.70. In comparison, BSE Sensex was trading 3.74 per cent lower at 72,544.62 levels.