Fortis Healthcare declines after DHS slaps Rs 500-crore fineon subsidiary

Fortis Healthcare fell 3.21% to Rs 162.80 at 9:56 IST on BSE after the company said its subsidiary has received an order to deposit Rs 503.36 crore for non-compliance of conditions of land allotment lease.

Meanwhile, the BSE Sensex was down 286.31 points, or 1.07%, to 26,349.44.

On BSE, so far 33,000 shares were traded in the counter, compared with an average volume of 53.38 lakh shares in the past one quarter. The stock hit a high of Rs 163.80 and a low of Rs 160.10 so far during the day. The stock hit a 52-week high of Rs 199.20 on 5 August 2015. The stock hit a 52-week low of Rs 141.10 on 12 February 2016. The stock had underperformed the market over the past one month till 10 June 2016, rising 0.18% compared with 3.28% rise in the Sensex. The scrip had also underperformed the market in past one quarter, rising 0.30% as against Sensex's 7.76% rise.

The mid-cap company has an equity capital of Rs 463.17 crore. Face value per share is Rs 10.

Fortis Healthcare announced after market hours on Friday, 10 June 2016, that one of its subsidiaries, Escort Heart Institute & Research Centre (EHIRCL), has received an order from The Directorate General of Health Services (DHS). The DHS has ordered to deposit Rs 503.36 crore towards recovery of unwarranted profit made by EHIRCL for alleged non-compliance of the conditions of allotment/lease of land since its allotment in 1982. EHIRCL believes that the impugned order in its view is legally flawed and untenable. The EHIRCL management will challenge the same in the High Court of Delhi or such relevant authority to seek suitable legal remedies available to it under law.

On a consolidated basis, Fortis Healthcare reported net loss of Rs 90.86 crore Q4 March 2016 as against net loss of Rs 17.53 crore in Q4 March 2015. Net sales rose 1.13% to Rs 1061.32 crore in Q4 March 2016 over Q4 March 2015.

Fortis Healthcare is a leading integrated healthcare delivery service provider in India. The healthcare verticals of the company primarily comprise hospitals, diagnostics and day care specialty facilities.

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