Shivalik Rasayan made waves in the share market investment world on October 3, with its shares surging by a notable 15%. This sharp rise followed the US Food and Drug Administration's (USFDA) approval of its Active Pharmaceutical Ingredient (API) manufacturing facility located in Dahej, Gujarat. The approval not only closed the inspection of the facility but also opened the doors for the company to file new products specifically aimed at exporting to the US market, further enhancing its growth potential.
Impact of USFDA approval on stock performance
At 1.53 PM, Shivalik Rasayan's shares were trading at ₹617, a solid performance despite coming off the day's high of ₹649. The approval triggered a significant jump in trading volumes, with three lakh shares changing hands on the exchanges, compared to the one-month daily traded average of just 59,000 shares. This meteoric rise highlights the growing interest in share market investments linked to pharmaceutical companies with regulatory green lights, as approvals from international bodies like the USFDA often serve as major catalysts for stock price movements.
Shivalik Rasayan's financial snapshot
Despite the recent success on the stock market, Shivalik Rasayan's financial performance for the April-June quarter of FY25 painted a more nuanced picture. The company posted a 16% increase in total sales, bringing in ₹74.63 crore compared to ₹64.47 crore in the same period last year. However, its net profit fell sharply to ₹3.52 crore, almost half of what it earned in the previous fiscal year's first quarter. Investors who focus on share market investments in the pharmaceutical sector will be watching closely to see how Shivalik Rasayan's recent USFDA approval might help turn around its bottom line in the coming quarters.
Key takeaways
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