Ranbaxy's pill gets bitter

Ranbaxy Labs is back in the limelight and once again, not in good light. The stock has been hitting new highs since 18th Aug and yesterday, it had hit a new high at Rs.648.55 and today it has slipped down to Rs.626.60. Currently it remains in the red.

The stock has been dumped once again today after unconfirmed news came in that the company has been fined to the tune of Rs.240 crore – a penalty imposed by State of Texas over possible violations at its Tonsa facilities.

This fine is likely to be a part of some dues claimed from Ranbaxy from its previous slippages, for which it had earlier paid US$500 million in May’13. The company as such has shown a poor performance for Q1FY15 and this news does not really make things better. But the only solace here is that the company, when it published its Q1FY15 numbers stated that it had made a provision of Rs 238 crore for on-going settlement discussions with certain government authorities in USA. So maybe there might not be any additional financial burden though the saga seems to be continue forever.