After having been in the news for all the wrong reasons, Wockhardt has managed to turn the flow in its favour to a great extent this year. While it still carries a huge debt on its books, it has managed to improve its balance sheet in the last six months that seems to have enthused the stock markets.

Its debt-to-equity ratio was 2.6 times at the end of the September quarter against 3.4 times seen in March. What has also earned it brownie points is its improved business and cash flows. For the quarter ended September, the pharmaceutical company reported 18 per cent increase in sales to Rs 1,111 crore, helped by growth in its key markets of US, Europe and India.

This helped it turnaround its loss of Rs 97 crore in the second quarter of last year to a consolidated net profit of Rs 128 crore this quarter.

While volatile exchange rates could dent profitability in the coming quarters, expectations of a debt reduction using the proceeds from the sale of its nutrition business and brands to French Dairy giant Danone SA has buttressed the stock. But for the Rs 320 crore odd that could go to Carol Info Services, a large portion of the sale price of Rs 1,600 crore would accrue to Wockhardt.

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