Wockhardt fell on reports of brokerage downgrade


Wockhardt fell 9.91% to Rs 915 at 11:26 IST on BSE on reports that a foreign brokerage downgraded the stock to neutral from outperform.Meanwhile, the BSE Sensex was up 94.99 points, or 0.34%, to 28,173.34.On BSE, so far 4.47 lakh shares were traded in the counter, compared with average daily volume of 1.79 lakh shares in the past one quarter. The stock hit a high of Rs 960 and a low of Rs 870 so far during the day. The stock hit a 52-week high of Rs 1,748.20 on 2 December 2015. The stock hit a 52-week low of Rs 706.35 on 12 February 2016. The stock had outperformed the market over the past 30 days till 5 August 2016, rising 8.13% compared with 3.22% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 8.43% as against Sensex’s 11.30% rise.The large-cap company has an equity capital of Rs 55.27 crore. Face value per share is Rs 5.The downgrade was followed by media reports suggesting that Wockhardt’s Ankleshwar plant received an import alert from the US Food and Drugs Administration (USFDA) for alleged violation of good manufacturing practices.According to reports, the foreign brokerage said that the Ankleshwar facility receiving under import alert may lead to Wockhardt’s multiples falling under pressure in the near term. However, the brokerage reportedly remains bullish on the stock for long term.Reports sugested that the USFDA had carried out an inspection at the Ankleshwar plant in November last year and issued adverse observations known as Form 483 for violating good manufacturing practices. The Ankleshwar plant makes both formulations and active pharmaceutical ingredients and largely caters to domestic and European markets. However, it exports some formulations and active pharmaceutical ingredients (APIs) to Wockhardt’s US plant.On a consolidated basis, net profit of Wockhardt rose 25.88% to Rs 42.90 crore on 6.10% decline in net sales to Rs 1013.36 crore in Q4 March 2016 over Q4 March 2015. The company will announce Q1 results on 13 August 2016.Wockhardt is a research based and technology intensive global pharmaceutical and biotechnology company.

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