Shares of Sequent Scientific Ltd rose sharply in Thursday’s trade after the company called off a proposed acquisition of Tineta Pharma. The stock soared 14.64 per cent to hit a day high of Rs 71.51 over a previous close of Rs 62.38. A total of 12.62 lakh shares changed hands today on BSE, which was nearly 15 times higher compared to the two-week average volume of 85,000 shares. Turnover on the counter stood at Rs 8.85 crore, commanding a market capitalisation (m-cap) of Rs 1,783.45 crore. There were 1,56,700 sell orders today against buy orders of 1,15,715 shares.
The stock recovered sharply today after touching its 52-week low level of Rs 61.80 in the previous session. That said, Sequent has lost more than half of its value in terms of the share price. At today’s day high of Rs 71.51, the scrip traded 54.13 per cent lower from its one-year high level of Rs 155.90, hit on April 6 last year.
Sequent, in an exchange filing, said, “We refer to our announcement on November 7, 2022, regarding the acquisition of a 100 per cent stake in Tineta Pharma Private Limited (‘Tineta’) by the Company, it is hereby informed that the transaction contemplated under the Share Purchase Agreement has not been materialized. Therefore, the Company will not acquire Tineta and the Share Purchase Agreement entered by the Company with Tineta and its Promoters on November 07, 2022 stands terminated.”
The stock was last seen trading higher than the 5-day and 20-day moving averages but lower than the 50-day, 100- and 200-day moving averages. The counter’s 14-day relative strength index (RSI) came at 54.39. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company’s stock has a negative price-to-equity (P/E) ratio of 703.10.
Sequent has an average target price of Rs 149, Trendlyne data showed, suggesting a potential upside of 107.67 per cent. The scrip has a one-year beta of 1, indicating average volatility on the counter.
It reported a consolidated net loss of Rs 8.87 crore in the December 2022 quarter (Q3 FY23) against a net profit of Rs 17.12 crore in the same period last year. The company’s revenues rose 4.80 per cent year-on-year (YoY) to Rs 375.31 crore in Q3 FY23.’
On Sequent’s Q3 results, Rajaram Narayanan, Managing Director, said, “Q3 FY23 reflects the strengthening of our business, across both APIs and key formulations markets, with overall revenue growth of 10.0% in constant currency terms over Q2 FY23. While the cost environment continues to be challenging for the industry, gross margins have remained stable.”
The Mumbai-based company is among the biggest animal healthcare companies in the country and is backed by global investment firm Carlyle. It has 9 manufacturing facilities across Europe, Turkey, Brazil & India with the Vizag site being India’s only USFDA-approved dedicated veterinary API facility. And, Tineta Pharma is a veterinary pharma company.
Meanwhile, Indian equity benchmarks fell in today’s deals, dragged by automobile, consumer, technology and energy stocks.
Also read: Aptus Value shares plunge 5% as HFC denies stake sale talks with Cholamandalam
Also read: Top picks: KR Choksey sees up to 55% upside in these 6 stocks; should you buy?