Drug-maker Wockhardt said its promoters and promoter-entities have completely released shares pledged by them earlier.
Over 6.97 crore shares held by Khorakiwala Holdings and Investments and another 442,785 shares held by Habil Khorakiwala were released. With this, promoters have no more shares pledged in the market.
Wockhardt did not share other details.
Analysts said the release of pledged shares is a positive for the stock, but it does not end troubles for the company.
Bhavika Thakker, research analyst with IIFL, said the June quarter has not been kind to the company.
One bad news followed another: US drug regulator FDA issued ‘Form 483’ – it is a post-inspection record of violations of quality or safety norms at the drug manufacturing plant – last week to Wockhardt’s Chikalthana unit, which contributes the largest chunk to the company’s revenues; before that, there was a warning letter; then, an FDA import alert for the Waluj facility. Even the UK drug regulator was not happy with the Chikalthana unit.
Consequently, Wockhardt’s stock plummeted 77% this fiscal so far (from Rs2,005.80 on April 1 to Rs454.25 on Tuesday).
“Release of the promoters’ pledged shares is just a short-term measure. I’d still advise a wait-and-watch approach on this stock. There are some serious operational issues that need to be addressed by the management to bring back confidence in the market,” said Thakker.
Analysts said Wockhardt now looks like a beaten-down stock. Although some traders may perceive in it a counter-bet, the stock does not make for a good pick from an investment perspective, they said.
“Any bad news from the Chikalthana facility will see the stock getting battered,” said an analyst. To preempt any such situation, Wockhardt has got on board the US-based Lachman GMP Consultant to assist it in reviewing all the regulators’ observations.