Dishman Carbogen hits new low on rating downgrade, tanks 38% in 3 days

Rating agency India Ratings & Research downgraded the credit ratings outlook for long term and short term facilities of the company from "Stable" to "Rating Watch Evolving".

Shares of Dishman Carbogen Amcis tanked 9 per cent to hit a new low of Rs 64.75 on the BSE on Friday. The pharmaceutical company's stock has tanked 23 per cent in the past three days despite the company’s clarification on a report that the income tax (I-T) department found unaccounted cash during a search-and-survey operation last month.

Meanwhile, rating agency India Ratings & Research ("IndRa") downgraded the credit ratings outlook for long term and short term facilities of the company from "Stable" to "Rating Watch Evolving" ("RWE").

The RWE considers the search operations conducted by income tax authorities at the company's head office and manufacturing sites on December 19, 2019. The rating outlook shall be monitored and resolved within six months, the rating agency said.

On December 18, the company informed the stock exchanges that I-T department conducted day-long 'search and survey operation' at the properties of a pharma major.

It later issued a clarification in respect of various news articles published in newspapers regarding search conducted by I-T authority at the company's offices and manufacturing sites during 19th December, 2019 to 25th December, 2019 and alleged transactions, claims of deductions by the Company, transfer pricing issues.
 

“We would like to clarify that we have not received any official communication, letter or notice from I-T department for any tax demand in this regards. We are therefore not in agreement with the alleged findings as mentioned in the newspaper articles/reports,” Dishman Carbogen said in exchange filing.

Since that day, the the stock has plunged 47 per cent in 12 trading days.

At 09:55 am, the stock was trading 6 per cent lower at Rs 66.65 on the BSE, as compared to 0.28 per cent decline in the S&P BSE Sensex. A combined 976,870 equity shares have changed hands on the counter on the NSE and BSE so far.