IPCA Labs slumps after brokerage downgrade

IPCA Laboratories fell 10.33% to Rs 669.20 at 12:49 IST on BSE after a foreign brokerage downgraded the stock to "underperform" from "neutral", citing negative US Food and Drug Administration observations.

Meanwhile, the BSE Sensex was up 7.08 points, or 0.03%, to 27,867.46.

On BSE, so far 4.36 lakh shares were traded in the counter, compared with an average volume of 34,946 shares in the past one quarter.

The stock hit a high of Rs 728 and a low of Rs 635 so far during the day. The stock hit a record high of Rs 906.90 on 28 February 2014. The stock hit a 52-week low of Rs 635 on 5 November 2014.

The stock had underperformed the market over the past one month till 3 November 2014, falling 4.88% compared with 4.86% rise in the Sensex. The scrip had also underperformed the market in past one quarter, rising 2.94% as against Sensex's 9.34% rise.

The mid-cap company has an equity capital of Rs 25.24 crore. Face value per share is Rs 2.

US Food and Drug Administration (USFDA)'s observations are on IPCA Laboratories' Indore facility, the brokerage said, adding that two of these observations are critical, and could delay the recovery of US sales for IPCA Laboratories.

The company will announced Q2 results on 10 November 2014. Net profit of IPCA Laboratories rose 102.7% to Rs 145.49 crore on 16.7% rise in net sales to Rs 928.20 crore in Q1 June 2014 over Q1 June 2013.

IPCA Laboratories is a fully-integrated Indian pharmaceutical company manufacturing over 350 formulations and 80 APIs for various therapeutic segments.

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