Wockhardt freezes at 5% lower circuit post weak operating performance in Q1

Shares of Wockhardt were locked in the 5 per cent lower circuit band at Rs 312.55 on the BSE on Monday despite turning profitable in the June quarter of FY21. The pharmaceutical company posted consolidated net profit of Rs 760 crore, as against net loss of Rs 36.88 crore in the year-ago quarter. The was mainly on account of exceptional items in connection with the transfer of a business comprising 62 products and Baddi facility to Dr Reddy's Laboratories, it said in a statement. In comparison, the S&P BSE Sensex was down 0.7 per cent at 12:04 pm.

The earnings, however, were weak on the operational front. Total income stood at Rs 606.22 crore in the quarter under review. It was Rs 733.66 crore in the year-ago period, the filing added. Revenue from India Business declined by 52.5 per cent to Rs 116 crores in Q1FY21 and revenue from USA business is down by 38.7 pe cent to Rs 114 crores in Q1FY21. Company reported negative EBITDA for the quarter at Rs 49 crores as against positive EBITDA of Rs 56 crores in Q1FY20.

Wockhardt launched new chemical entity (NCE) during the quarter in the Indian pharma market. Products have been launched under the tablet and injection category under the brand name 'Emrock O and Emrock', the filing said.

It said that divestment of business undertaking to Dr Reddy's Laboratories was accomplished during the quarter and Rs 1,483 crore has been received towards the same.

"Rs 43 crore out of Rs 67 crore deposited by the purchaser in an escrow account, towards adjustments for, inter alia, net working capital, employee liabilities and certain other contractual and statutory liabilities etc has since been settled and received," it added.

The stock hit a 52-week high of Rs 411.6 per share on the BSE on February 11, 2020, while its 52-week low was Rs 147 hit on March 24.

So far in the financial year 2020-21, the stock has surged 90 per cent on the BSE, as against 34 per cent rally in the S&P BSE Sensex, BSE data show.