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Brooks Lab slumps after Sebi confirms 5-year ban from capital market

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Capital Market
Last Updated : Sep 12 2015 | 12:01 AM IST

Brooks Laboratories hit a lower circuit of 10% at Rs 58.30 at 11:21 IST on BSE after the stock market regulator issued a final order banning the company, its directors and other key personnel from the securities markets for five years.

Meanwhile, the BSE Sensex was up 41.92 points, or 0.16%, to 25,664.09.

On BSE, so far 1.04 lakh shares were traded in the counter, compared with an average volume of 1.48 lakh shares in the past one quarter.

The stock hit a high of Rs 60.75 and a low of Rs 58.30 so far during the day. The stock hit a 52-week high of Rs 106.80 on 31 July 2015. The stock hit a 52-week low of Rs 36.15 on 28 February 2015.

The stock had underperformed the market over the past one month till 10 September 2015, falling 28.77% compared with 8.82% fall in the Sensex. The scrip had, however, outperformed the market in past one quarter, rising 56.40% as against Sensex's 4.54% decline.

The small-cap company has an equity capital of Rs 16.19 crore. Face value per share is Rs 10.

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Confirming its interim order issued in December 2011, the Securities and Exchange Board of India (Sebi) on Thursday, 10 September 2015, issued final order banning Brooks Laboratories, its directors and other key personnel from accessing the securities market for five year and also prohibited these entities from buying, selling or dealing in securities market for a period of five years on charges of siphoning off funds raised from the initial public offer (IPO) in August 2011 and concealing of material information in IPO documents.

Sebi in its final order said that the period of prohibition already undergone by Brooks Laboratories and its directors and officers pursuant to Sebi's interim order dated 28 December 2011 shall be taken into account for the purpose of computing the period of prohibition imposed in the final order. This means that the the period of prohibition will end in December 2016.

In its final order, Sebi has allowed Brooks Laboratories to use the unutilized proceeds of the IPO lying in the escrow account. Earlier, Sebi had in its interim order in December 2011 had directed the company to call back advance payment made to project contractor Suryamukhi Projects Pvt. Ltd and Neo Power Universal FZ LLC, UAE which was the supplier for plant and machinery for the company's project. Sebi had directed the company to keep this money along with unutilized proceeds of the IPO in an escrow account.

Brooks Laboratories' net profit rose 7.14% to Rs 1.65 crore on 9.23% rise in net sales to Rs 17.98 crore in Q1 June 2015 over Q1 June 2014.

Brooks Laboratories is a contract manufacturing pharmaceutical company.

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First Published: Sep 11 2015 | 11:35 AM IST

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