Sell Wockhardt, says Mayuresh Joshi

Mayuresh Joshi, VP Institution of Angel Broking told CNBC-TV18, "The US food and drug administration (FDA) letter which has come in seriously points out at some serious grievances that was happening at Wockhardt's Waluj facility. The incremental revenues that can come from this facility can get impacted if it gets delayed for another three to four quarters more or less because 46 ANDA applications were supposed to get filed on that facility out of which 12 are already filed. So, in that sense an external consultant, when it happened with Ranbaxy as well USD 30 million was what was spend on this consultant and the whole restructuring exercise actually took three to four quarters."

"In that sense itself there might be some stickiness related to this news of Waluj facility. However, having said that there are a couple of their new facilities are also getting ready for inspection by the FDA in the next couple of months. So, that might be an overhang for the stock if the FDA comes out with some kind of non conformities with these two additional facilities where they derive a substantial of their revenues from. So, in that sense the underperformance of the stock might continue for the next one to two months and if any adverse reactions come in from the FDA statements that can have a further beating down or a negative reaction on that stock," he said. "If one has the patience to possibly risk on this trade over the next two to three months then one should hold on to the stock otherwise one should exit the stock and look at something like a Lupin or even Dr Reddys Laboratories which posted a good set of numbers within the pharma space." Also Read: Wockhardt falls 5% after Maharashtra FDA files 7 FIRs