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Apollo Hospitals says speculative unwinding has led to its stock price plunging to a six-month low on Thursday. The stock recovered partially on Friday, after the company clarified on warrant allocation to one of its promoters.
“We are as clueless as others as to what is happening. Speculative build-up has led to share price being knocked off badly on Thursday. It is purely market operators at play here. The price has come back substantially on Friday,” said Mr Akhileshwaran Krishnan, Chief Financial Officer, Apollo Hospitals.
Apollo had received enquiries with regard to the recent allotment of 30.89 lakh equity shares of Rs 5 each to Dr Prathap C. Reddy, one of the promoters of the company, at a price of Rs 385.88 a share on December 10. The company has clarified that this allotment is on conversion of warrants issued to Dr Reddy on June 12, 2010, according to the SEBI formula at the then prevalent market price and after obtaining requisite shareholder approval.
On Thursday, the company stock fell 14 per cent on the BSE. On Friday, it improved 11.51 per cent to end at Rs 532.05.
“Following the plunge, we have had a few investors and research firms checking with us if things are on track. We assure that business is continuing as usual. The growth momentum is there. Our hospital expansion is on as planned,” said Mr Krishnan.
Earlier this month, there was substantial increase in trading volumes in Apollo Hospitals. On December 2, about 7 lakh shares were traded on the NSE. This was a quantum jump from 41,594 shares traded on December 1.
Following this, the company clarified to the stock exchanges that “there is no information/announcement (including pending announcements) which could have a bearing on the price/ volume behaviour in our scrip.”
On December 8, Dr Prathap Reddy made an inter se transfer of 10.3 lakh shares to PCR Investments, a promoter group company, for Rs 70 crore.
There has also been “speculation” that Apollo is looking for partners to hive off its pharmacy business. “There is nothing happening at Apollo on that front now,” said Mr Krishnan.
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