The Hindu Business Line : Divi's Lab turns weak

According to dealers, the end of circulation of rumours in market by the company's denial on last Friday caused selling, particularly by the traders and operators.

Even though the stock closed down 2.4 per cent, the traded volume increased from 45,830 shares on Friday to 48,950 shares on the Bombay Stock Exchange. The traded quantity on the National Stock Exchange was a substantially lower at 1.03 lakh shares (1.90 lakh shares). The counter, which has been moving up smartly withstanding general weakness in the market through last couple of weeks, on strong rumours that the company was likely to announce of a bonus issue and stock split, today closed at Rs 1,723.10 (Rs 1765), after touching its all-time high of Rs 1,825. Since February 3, it had put on a gain of Rs 309 at Friday closing. On the NSE, the stock attracted one block deal involving 25,000 shares. The delivery percentage was low (10.5 per cent) due to traders' square-off activity.

At today closing price, the stock traded at 31.3 times its trailing four-quarter earnings of Rs 55. Divi's Lab has given a revenue guidance of Rs 400 crore for 2004-05. It also expects to file six new drug master files with the US Federal Drug Administration, Mr Vikash Jain of Anagram Stockbroking pointed out.

Interestingly, the top pharma stocks, except Dr Reddy's, closed lower today

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