Shares of Fortis Healthcare rose as much 2.7 per cent to Rs 150.05, their highest since May 30 as the deal between Fortis Healthcare Ltd and Malaysia-based IHH group will most likely go through, with 99.69 per cent of votes by shareholders in favour of the deal.

The transaction will enable the IHH group to infuse an initial Rs 4,000 crore at Rs 170 per share. Also, IHH will control a majority of two-thirds seat on the Fortis’ board.

According to the disclosure made by Fortis to stock exchanges on Tuesday, 99.99 per cent shareholders also voted to increase the authorised capital in the company and reclassification of promoters of the group, brothers Malvinder and Shivinder Singh, to public shareholders category. This move will remove them from the status of ‘promoters,’ in the company and bring in IHH subsidiary NTK Pvt Ltd in their place.

Fortis has posted June-quarter loss of Rs 70.74 crore ($10.12 million) as it struggled with a cash crunch, rising debt and other problems. The hospital operator aims to reach an occupancy rate of over 70 per cent in Q4.

JP Morgan analysts believe that the data points on occupancy improvement indicate a definite path to recovery in growth and margins. They have maintained 'overweight' rating with a price target of Rs 185.

Pending approval from the Competition Commission of India, near-term improvement in earnings and clarity from IHH on long-term growth will be key drivers for stock, JP Morgan says.

Eight brokerages have rated the stock “buy” or higher, with a median price target of Rs 185. Up to Tuesday's close, the stock had risen 2.7 per cetn since the board approved IHH offer to invest Rs 4000 crore at Rs 170 per share in Fortis.

(With inputs from Reuters)

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