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Pharma stocks decline sharply

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Capital Market
Last Updated : Aug 10 2017 | 12:01 AM IST

Stocks cut losses in morning trade after an initial setback caused due to negative global stocks. At 10:25 IST, the barometer index, the S&P BSE Sensex, was down 53.67 points or 0.17% at 31,960.52. The Nifty index was down 13.05 points or 0.13% at 9,965.50. The Sensex was trading below the psychological 32,000 mark after sliding below that level in opening trade. Rising geopolitical concerns after the US and North Korea exchanged threats also weighed on the bourses. Pharma stocks declined sharply.

Domestic stocks saw gap-down opening on negative global cues.

The S&P BSE Mid-Cap index was down 0.43%. The S&P BSE Small-Cap index was down 0.43%. The fall in both these indices was higher than the Sensex's decline in percentage terms.

The broad market depicted weakness. There were more than two losers against every gainer on BSE. 1,374 shares declined and 587 shares rose. A total of 79 shares were unchanged.

Overseas, Asian stocks declined as investors took a risk-off approach after the US and North Korea exchanged threats amid escalating tensions between the two nations. Meanwhile, China's producer price gains held steady in July on surging commodity prices, as demand stayed resilient and the government's drive to reduce industrial capacity takes hold.

US stocks finished near lows of the session yesterday, 8 August 2017 reversing earlier gains as an early rally in financial, tech and energy stocks fizzled amid tough talk from President Donald Trump on North Korea. In US economic news, the Labor Department reported on Tuesday that the number of job openings in June vaulted to 6.16 million from 5.7 million in May.

Back home, pharma stocks declined sharply. Cadila Healthcare (down 2.56%), Cipla (down 0.64%), Dr Reddy's Laboratories (down 1.68%), Glenmark Pharmaceuticals (down 1.86%), Lupin (down 1.08%), GlaxoSmithKline Pharmaceuticals (down 1.54%), Aurobindo Pharma (down 3.23%) and Wockhardt (down 0.83%) declined. Alkem Laboratories (up 0.57%) rose.

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Sun Pharmaceutical Industries (Sun Pharma) dropped 2.6%. Sun Pharma announced that one of its wholly owned subsidiaries has agreed to acquire by way of allotment to it, 2.03 lakh Series A Preferred Stock (equivalent to 15.91% fully diluted equity stake on conversion) of Krystal Biotech Inc., United States of America, a biopharmaceutical company using gene therapy to develop treatments for patients suffering from rare debilitating disorders. The announcement was made after market hours yesterday, 8 August 2017.

Cement stocks were trading lower. Ambuja Cements (down 0.82%), ACC (down 0.25%), UltraTech Cement (down 0.74%) fell. Shree Cement (up 1.34%) gained.

Grasim Industries was up 0.96%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Astral Poly Technik lost 1.28% after consolidated net profit fell 6.7% to Rs 24.84 crore on 3% decline in net sales to Rs 407.32 crore in Q1 June 2017 over Q1 June 2016. The result was announced after market hours yesterday, 8 August 2017.

The company's consolidated earnings before interest, taxation, depreciation and amortization (EBITDA) declined 7.31% to Rs 50.70 crore in Q1 June 2017 over Q1 June 2016. EBITDA margin contracted to 12.45% in Q1 June 2017, from 13.03% in Q1 June 2016.

SRF fell 7.26% after consolidated net profit fell 32.84% to Rs 103.81 crore on 7.14% increase in total income to Rs 1312.91 crore in Q1 June 2017 over Q1 June 2016. The result was announced after market hours yesterday, 9 August 2017.

SRF said that its Q1 net profit declined mainly on account of subdued commodity prices, channel destocking during the transition to the Goods and Services Tax (GST) regime and strengthened rupee. In a separate announcement, SRF said that its board approved setting up a facility to produce specialty chemicals (P-33) for agro industry at the company's chemical complex in Dahej, Gujarat at an estimated cost of Rs 85 crore.

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First Published: Aug 09 2017 | 10:28 AM IST

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