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Orchid Chemicals facility gets closure notice; shares fall

Orchid Chemicals facility gets closure notice; shares fall
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First Published: Mon, Jul 11 2011. 04 22 PM IST
Updated: Mon, Jul 11 2011. 04 22 PM IST
Mumbai: Drugmaker Orchid Chemicals & Pharmaceuticals said on Monday its active pharmaceutical ingredients (APIs) making facility received a closure notice regarding disposal of solid waste, pushing its shares down over 5%.
The Tamil Nadu Pollution Control Board (TNPCB) has cited non-compliance regarding solid waste disposal at the facility that makes antibiotic cephalosporin, the company said in a statement.
“I don’t think of a significant (impact) because you know, any company will have working capital... which will be there in the pipeline. So it all depends on how earliest we come back,” K. Raghavendra Rao, chairman and managing director, Orchid Chemicals & Pharmaceuticals, told Reuters by telephone.
“Cephalosporin is a key product for Orchid Chemicals and the closure may lead to certain sales impact. However, there needs to be more clarity on how serious the violations are,” a pharma analyst with a Mumbai-based brokerage said.
The company is in dialogue with TNPCB officials and is confident of resolving the issues and bringing the plant to a fully operational stage at the earliest, it said in a statement.
At 1:10pm, shares of Orchid Chemicals, which have lost 19.4% in value over the last three months, pared losses and were trading at 245.10 rupees, down 1.45% in a weak Mumbai market.
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First Published: Mon, Jul 11 2011. 04 22 PM IST