It will be business as usual at Dr Reddy's
Analysts say demise of Dr Anji Reddy will not change the company's course as he stepped down from active...
Analysts say demise of Dr Anji Reddy will not change the company's course as he stepped down from active management sometime back According to a senior executive of a pharma company, there is a chance that DRL may bring in a professional from outside as executive chairman, as a neutral choice Hyderabad: Market analysts are of the opinion that there may not be any major directional changes at city-based pharma major Dr Reddy's Laboratories Limited (DRL) despite demise of its founder Dr Kallam Anji Reddy. The 73-year-old technocrat-turned-entrepreneur, who founded DRL in 1984 with Rs 25 lakh capital and nurtured it into Rs 10,000-crore global pharma major, passed away here on Friday. At present, his son Satish Reddy is Managing Director and Chief Operating Officer of the company, while son-in-law GV Prasad is Vice Chairman and Chief Executive Officer. "I don't see any directional changes. Whatever changes that are there now were brought in when he was active. They may continue," said Sarabjit Kour Nangra, VP, Research Specialist Pharmaceuticals, Angel Broking. Anji Reddy was not present at the company's annual general meeting last July and his absence gave rise to speculation about his succession plans as he never missed any AGM in the company's three-decade long history. It was later clarified that that he couldn't make it to the AGM because of ill-health. However, Dr Reddy, who remained as Chairman of the company till his last breath, indicated several times in the past that he would take backseat and guide others in running the company."Though I may not involve in the company's operations actively, but I will guide them all along," he explained at the one of the earlier AGMs when some investors insisted that he should continue to lead the company from the front. "There will not be any changes in the day-to-day affairs also. Reddy was not actively participating in company affairs for the past few years," Nangra added. The stock market took note of Anji Reddy taking backseat after he transferred practically his entire stake in the promoter holding company - Dr Reddy's Holdings Ltd (DRHL) - to the Reddy family trust (APS Trust), leaving him with just 100 shares in his personal capacity in DRHL. Last year, the pharma major informed the bourses that Anji Reddy, who held 40 per cent stake in DRHL, had transferred 39.99 per cent of the stake to APS Trust. At present, DRL promoters hold 25.56 per cent stake in the company. "As many of the senior employees of the company have attachment with Anji Reddy, they may be sentimental for some time. As both son and son-in-law are equally participating in company affairs anyone of them may be elected as chairman," said Satish Kanteti of Zen Securities. In any case, market has recognised DRL now as a professionally managed company. We see that change in the quarterly results announcements, he added. Top officials like CFO and head of Global Generics are addressing press conferences and attending investor calls for the past three quarters which was usually handled by Satish Reddy and G V Prasad. According to a senior executive of a pharma company, there is a chance that DRL may bring in a professional from outside as executive chairman, as a neutral choice. Naandi: At his charitable best Dr K Anji Reddy, who created waves in pharmaceutical industry through his innovative initiatives that propelled Dr Reddy's Labs (DRL) into big league, was equally effective on philanthropic front. Reddy, who used to donate Rs 2 crore every year from his earnings for charitable activities, set up Dr Reddy's Foundation in 1993. As not-for-profit partner of DRL, the foundation has initiated path-breaking measures to educate street children, besides offering vocational training to scores of people. However, the DRL founder provided new meaning to social work when he founded Naandi Foundation, a public charitable trust, in 1998. As the founding Chairman of the foundation, he provided visionary leadership and was instrumental in charting out its course for the uplift of poor students in the country. Beginning with AP, it expanded activities to Madhya Pradesh, Rajasthan, Odisha and Chhattisgarh where it provides mid-day meal and drinking water to over 13 lakh students. His philanthropic activities had left positive impact on over 50 lakh people, mostly children and youth.
26 Jun 2019 1:43 PM GMT