Glenmark Slumps on Third-Quarter Earnings Drop: Mumbai Mover
Glenmark Pharmaceuticals Ltd. (GNP) fell the most in almost six months in Mumbai trading after the Indian drugmaker reported a 58 percent drop in third-quarter profit because of foreign exchange losses.
Glenmark tumbled as much as 7.6 percent, the biggest drop on an intraday basis since Aug. 5, before trading 7 percent lower at 290 rupees as of 12:19 p.m. local time. The stock was the biggest loser on the BSE200 Index.
Profit fell to 461.2 million rupees ($9 million) in the three months ended Dec. 31 after recording a loss of 1.02 billion rupees on foreign currency loans, the Mumbai-based company said yesterday. After adjusting for the one-time loss, operating income still fell as slower growth in India and the U.S. put pressure on profit margins and that will continue, brokerage Kotak Institutional Equities said today.
“We remain disappointed with its quality with high margin regions of India and U.S. not growing as per our expectations,” Kotak analyst Priti Arora wrote in a note to clients. She cut her rating on the stock to “reduce” from “add” and lowered her 12-month price target by 9.3 percent to 340 rupees.
Citigroup Inc. and Credit Suisse Group also cut their 2012 earnings estimates for Glenmark.
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