Hopes spurt Elder Pharma by 17%
Shares of Elder Pharma are strongly up in the green, by a whopping 17%, since opening, with the current price being Rs. 98.35. Despite broader markets seem to be giving up the opening gains, Elder’s share price is ruling firm. Volumes on the counter are extra-ordinarily massive – 5 lakh share traded on NSE and 1.4 lakh on BSE, as against 2 week average of 85,000 share and 22,000 shares respectively.
News report suggest that company may be selling manufacturing facilities worth Rs. 100-150 crore in Maharashtra and Uttarkhand (Dehradun) along with other non-core real estate, to pare its high debt and re-pay creditors. As of 31st Dec 2014, company had consolidated gross debt of Rs. 745 crore and cash equivalents of Rs. 172 crore. It is also in talk with a North India based NBFC to exchange NCDs for collateral.
On 5th September 2015, company had informed the stock exchanges that is has been presently facing severe financial crunch along with exodus of employees. On account of shortage of employees, audit for financial year ended 30th June 2015 has not been completed within time, and it is yet to submit FY15 audited financial results, last date for which stood at 29th Aug 2015.
Today’s upmove is purely on the hopes that there may be revival in the financial stress currently facing the company. The saying ‘Buy on rumours, Sell on news’ seems to be apt here.