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Aurobindo Pharma in demand on plan to spin off units
Aurobindo Pharma jumped 6.71% to Rs 193.90 at 13:15 IST after the company said it was evaluating restructuring options including spinning off its active pharma ingredient and formulations unit to unlock value of an expanding segment of its business.
The company's plan of evaluating restructuring options was announced along with its quarterly earnings after market hours on Monday, 9 May 2011.
Meanwhile, the BSE Sensex was up 90.95 points, or 0.49%, to 18,619.91.
On BSE, 4.43 lakh shares were traded in the counter compared with average volume of 1.24 lakh shares over the past two weeks.
The stock hit a high of Rs 195.50 and a low of Rs 182.50 so far during the day.
In order to further strengthen and provide focus to the growing volume of active pharmaceutical ingredients (APIs) and formulation business, the board has constituted a restructuring committee to explore and evaluate possible growth-linked restructuring options, Aurobindo Pharma said in a statement.
The company's options include a spin off or demerger or any other suitable form, with the ultimate objective of enhancing shareholders' value and customer satisfaction.
The restructuring committee made up of the company's directors including independent directors is expected to recommend the best options to the company's board within three months.
Meanwhile, on a consolidated basis, Aurobindo Pharma reported a flat net profit of Rs 563.45 crore on 21.92% increase in total income to Rs 4406.67 crore in the year ended March 2011 over the year ended March 2010.
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