GQG Partners dips as Novo Nordisk selloff raises redemption risk
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The news: Shares in GQG Partners have dipped following a sharp 20% selloff in Danish pharmaceutical giant Novo Nordisk. The ASX-listed fund manager has significant exposure to the drug company, with Novo Nordisk ranking as a top holding in several of its funds.
The numbers: Novo Nordisk has over USD125 million wiped off its market cap over the weekend after announcing a much anticipated late-stage trial showed its next-generation weight loss drug CagriSema wasn't as effective as hoped.
GQG owns Novo Nordisk through its International Opportunities Fund as well as several others where it features as a top 10 holding. Shares in GQG dropped 4.8% on Monday.
The context: It's just the latest incident with a GQG portfolio company, with bribery charges against Adani triggering another GQG selloff last month. Fund managers have stood by Rajiv Jain's investment company however, backing his track record and arguing the fallout had been overdone.
What they said: In a client commentary note PAC Partners institutional equity sales James Nicolaou said the GQG exposure to Novo Nordisk could be multiple times larger than its Adani blowup.
"Reputational damage might ... be too much for unit holders to remain. May lead to [a] potential redemptions cycle," he said.
The source: GQG Factsheets
