Drugmakers weigh on Indian stocks amid US regulatory concerns

Bloomberg

India’s benchmark index edged lower as drugmakers declined on concern US Food and Drug Administration regulations would hurt the companies.
The S&P BSE Sensex dropped 0.1 percent at the close, while NSE Nifty 50 Index was down less than 0.1 percent, erasing an earlier gain of 0.2 percent. Divi’s Laboratories Ltd. fell 20 percent after saying the FDA issued import alerts on some of its products. Dr Reddy’s Laboratories Ltd. dropped 4.1 percent after the Bombay Stock Exchange sought clarifications on reports of repeated observations from the US drug regulator.
“Pharma stocks are being pulled down by negative sentiment due to regulatory issues with the USFDA,” Soumen Chatterjee, head of research at Guiness Securities Ltd., said by phone. The “strong rupee, low commodity prices are limiting the downside.”
Axis Bank Ltd., Aurobindo Pharma Ltd. and Idea Cellular Ltd. were among the worst performers on the Nifty Index. Divi’s fell the most on the BSE 500. Avenue Supermarts Ltd., controlled by Indian billionaire Radhakishan Damani, more than doubled in its trading debut after investor demand exceeded stocks on offer by 106 times.The shares surged as high as 650 rupees versus its offer price of 299 rupees, the best debut performance in four years. Tuesday’s performance values the department-store chain at 400 billion rupees ($6.1 billion).