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Hikal shares spike on Bombay High Court nod to restart plant

The Maharashtra Pollution Control Board on April 22 had ordered the closure of the company's Raigad manufacturing unit. The company had challenged the order in the high court

June 27, 2022 / 01:22 PM IST

The share price of Hikal jumped over 5 percent on June 27 after the pharma company said the Bombay High Court had allowed the reopening of its plant in Maharashtra’s Raigad.

At 12.50 pm, the stock was trading 5.36 percent higher at Rs 266.25 on BSE.

“Bombay High Court…vide its order dated June 23rd, 2022 (received late in the evening on June 25th, 2022), has set aside the MPCB direction and has directed MPCB to grant permission to the company, to re-start manufacturing activities at the company's manufacturing unit located at MIDC Taloja within a week from the date of the order,” the company told exchanges.

The Maharashtra Pollution Control Board (MPCB) on April 22 had ordered the closure of the company's Raigad manufacturing unit. The company had challenged the order in the High Court.

Hikal has been down 50 percent this year following its alleged involvement in a gas leak from a tanker in Surat in January that left at least six people dead and led to the arrest of the company’s top management.

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Some analysts, however, are bullish on the stock. In an early June report, ICICI Securities said even though headwinds persist but recovery is likely from H2FY23.

“We maintain buy despite near term headwinds as we continue to believe in the company’s execution prowess, visibility, capex and the management’s expectation of gradual business normalisation in both segments. Recent steep correction continues to offer a decent risk-reward proposition,” said Siddhant Khandekar of ICICI Securities.

The broker has a target of Rs 340 on the stock.
Moneycontrol News
first published: Jun 27, 2022 01:21 pm
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