Fortis Healthcare sinks on Rs 500-crore fine on subsidiary

Shares of Fortis Healthcare slumped over 4% in an early trade on Monday after the company said its subsidiary has received an order from the Directorate General of Health Services (DHS) to deposit Rs 503.36 crore for non-compliance of conditions of land allotment lease.

The shares dipped 4.81% to Rs 160.10 on BSE.

At NSE, shares of the company tumbled 4.92% to Rs 160.25.

Fortis Healthcare on June 10, said its subsidiary Escort Heart Institute and Research Centre (EHIRCL) has been ordered by the DHS to deposit Rs 503.36 crore for non-compliance of conditions of land allotment lease.

However, the company has said it will challenge the order for the recovery of 'unwarranted profit' made by Escorts not following conditions of land lease since its allotment in 1982.

"EHIRCL has informed us that in a long disputed case pertaining to the period 1984-2007, it has on Monday received an order from DHS for the deposit of an amount of Rs 503.36 crore towards recovery of unwarranted profit made by it for alleged non-compliance of the conditions of allotment/lease of land since its allotment in 1982," Fortis Healthcare said in a BSE filing on Friday.