Orhid Pharma hits 10% upper circuit
Orchid Pharma has hit the 10% upper circuit at Rs.53.60. It has closed on Friday at Rs.48.75,opening higher at Rs.53.
The stock is up on the back of news which came in on 14th March, regarding its CDR approval package. The company stated that the CDR Empowered Group approved the debt restructuring package and the features of the scheme are as follows:
Sale and transfer of of Orchid’s Penicillin and Penems API business, with its manufacturing facility at Aurangabad and R&D facility at Chennai. Money raised from this, would be used for repayment of Rs.681 crore of the total debt of Rs.2866 crore to lenders. The package also approved interest funding for first years on the debt. The restructured debt together with funded loans has to be repaid over a period of 8 yrs, starting April 2015.
This is great news for the company which is beleaguered due to its high debt. This CDR will thus help complete the transfer of the API business to Hospira, help bring in funds for working capital, while deleveraging the debt.