Yatharth Hospitals plunges 9% as MP govt orders take over of Ramraja Hospital premises

Shares of the firm have climbed 17.48 percent since listing on the bourses in August this year.

Shares of Yatharth Hospitals tanked 9 percent in early trade on November 29 as the hospital operator received an order from the Commissionerate of Sagar Sambhag, Madhya Pradesh to take over the premises of Ramraja Hospital.

In a regulatory filing, Yatharth Hospitals said, “We further inform you that no notice or communication in this regard was received by the company before and this order has come as a total surprise to us.” Therefore, the firm “believes that this order is not based on true facts and has decided to prefer an appeal at the Madhya Pradesh High Court”.

The company’s stock was trading at Rs 411.95 apiece at 10.17 am, lower by 9.16 percent from the previous session’s close on the NSE.

Yatharth Hospitals acquired a complete stake in Ramraja Multispeciality Hospital & Trauma Centre on February 18, 2022. Prior to the acquisition, Ramraja Hospital acquired a total 5.698 hectare of land from different individual owners across various dates i.e. from the year 2012 to 2017.

After acquiring these lands, Ramraja Hospital obtained NOCs from different government authorities for commercial/hospital operation and the government converted these lands from agriculture to commercial/hospital use.

Ramraja Hospital became operational in 2017; in 2019, the National Highway Authority of India (NHAI) acquired 0.962 and 0.418 hectare land from the last owner of Ramraja Hospital for road widening. The NHAI paid compensation for the land acquired.

Despite receiving an order, the hospital operator said that there will be no impact on the ongoing operations at Ramaraja Hospital. “We are committed to ensure the smooth functioning of the hospital and foresee no significant impact on the financial and operational performance of the hospital,” said Yatharth Hospitals.

In October, several premises in Uttar Pradesh and Delhi of the Yatharth Hospital group were raided by the income tax department on charges of tax evasion.

Since its listing on the bourses on August 7, shares of the company have climbed 17.48 percent.