Divi's Laboratories: High on hopes

Positive outcome of ongoing plant inspection can lead to more gains

Divi’s Laboratories’ share price rose almost 15 per cent at Rs 829 in two trading sessions, as investors remain hopeful on the prospects of the company’s Unit II at Visakhapatnam, which is under inspection of the US drug regulator (USFDA).

The FDA had issued an import alert in March 2017.

The plant contributes almost 65 per cent to Divi’s consolidated sales (over half to US sales), and is crucial for the company’s growth.

Analysts, however, caution against a premature celebration.

The import alert had dealt a severe blow to the Street’s sentiment as well as to the company’s performance, even