The demise of Anji Reddy, the founder-chairman of pharma major Dr Reddy’s Laboratories, is not expected to lead to major directional changes, market analysts say.
The septuagenarian technocrat-turned-entrepreneur, who was suffering from cancer, died here two days ago.
Reddy’s son Satish Reddy is currently the Managing Director and Chief Operating Officer of DRL, while son-in-law G.V. 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, Vice-President, Research Specialist Pharmaceuticals, Angel Broking.
Anji Reddy’s absence at annual general meeting last July gave rise to speculation about his succession plans, but later it was informed that he couldn’t attend because of ill-health.
“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, Dr Reddy’s Laboratories 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.
Satish Kanteti of Zen Securities said: “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.
“In any case, market has recognised DRL now as a professionally managed company. We see that change in the quarterly results announcements.”
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 done 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”.