The Venezuelan politics is threatening to affect the workings of Glenmark and other Indian companies with a presence there. Yesterday, the country’s Opposition went on to win the elections with a ‘super majority’, indicating a change in the power seat.

The biggest task is front of the new Govt is correcting one of the worst performing economies of the world. Venezuela’s inflation is the world’s worst at 200%, and expected to climb to between 350% to 800% in 2016. There are rampant food shortages, a local currency that lost 81% of its value in 2015 on the black market, and the world’s second-highest murder rate.

For companies like Glenmark, the worry is that sweeping reforms might hurt them. Glenmark’s exposure to Latin America is pretty huge with $137 million revenue coming from this region. Many expect the new Govt to convert its battered currency into market-determined rates from the current fixed-rate and that is sure to make the currency volatile, in turn hitting earnings of Indian companies.

The stock price has tumbled down over 5% to Rs.883 with a intra day low of Rs.876. Volumes have surged almost 4 times.