Wockhardt's health slumps

Wockhardt is down in the red today. It had closed on Wednesday at Rs.660 but today, it opened at Rs.640.60 and went to the day’s low point at Rs 632.10. Thought it has recovered from this low, it remains in the red, currently down almost 2% at Rs.649 levels.

The stock has slumped on news that the Himachal Pradesh regulator has suspended manufacture and sale of three drugs - fixed dose combination of Dicyclomine Hydrochloride IP 10mg, Tramadol Hydrochloride IP 50mg and Acetamenophen IP 325mg. No reasons were given by the company for the suspension.

But news from the regulator suggested that the ban was because the company had used some of the chemicals, used to make the painkillers, was banned by the Indian Govt. The suspension will remain in force until a decision by the federal agency.

On the other hand, the company has stated that this suspension will not have too much of a material impact on the financials oas these products contribute less than 3% to the consolidated sales of the company in the financial year that ended on March 31. The company will appeal to the state government to revoke the suspension.