Jubilant Pharmova shares extend fall as Q4 net loss widens, dive 7% today; here's what analysts say

Shares of Jubilant Pharmova Ltd on Tuesday extended their downward trend for the second consecutive session. The stock plunged 7.14 per cent to settle at Rs 333.15 over its previous close of Rs 358.75. The scrip has declined 8.26 per cent on a year-to-date (YTD) basis and 13.41 per cent in a year.

Today's sharp decline in the stock price came after the company's wholly-owned subsidiary Jubilant HollisterStier General Partnership (JHSGP) said the US FDA (United States Food and Drug Administration) has determined the inspection classification of its facility in Montreal, Canada, as 'Official Action Indicated' (OAI). The US drug regulator, which audited JHSGP in February this year, mentioned that it may withhold approval of any pending applications or supplements in which the said facility is listed.

In addition, the company has announced a slew of leadership changes. Hari S Bhartia, presently Co-Chairman and Managing Director, has decided to step down from the position of Managing Director, effective May 31, 2023. He would continue as Co-Chairman, Non-Executive Director on the Board. Priyavrat Bhartia and Arjun Shanker Bhartia have been appointed as Managing Director and Joint Managing Director, respectively, for a three-year term, effective from June 1, 2023.

Also, Arun K Sharma would take up the role of Group Treasurer and step down from the post of Chief Financial Officer (CFO). Further, Arvind Chokhany, who at present is Group CFO of Jubilant Bhartia Group & Whole-time Director, has taken up the additional role of CFO of Jubilant Pharmova.

The pharma firm's net loss widened to Rs 101 crore in the March 2023 quarter (Q4 FY23) from Rs 16 crore in Q3 FY23. The firm posted a profit of Rs 59.55 crore in Q4 FY22. Jubilant Pharmova's revenue from operations stood at Rs 1,678 crore in Q4 FY23 as against Rs 1,553 crore in Q3 FY23 and Rs 1,528 crore in Q4 FY22.

On the technical front, support on the counter could be seen at Rs 324, followed by Rs 315 levels.

Vaishali Parekh, Vice-President - Technical Research at Prabhudas Lilladher, said, "The stock has near-term support at Rs 315 zone. It would need a decent pullback to move past the Rs 360 zone for the overall trend to improve and turn positive."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "One can buy in the range of Rs 325-335 with an upside target of Rs 400 and stop-loss would be placed at Rs 295."

AR Ramachandran from Tips2trades said, "The stock now has support at Rs 324. Only a daily close above resistance of Rs 338 will help the trend turn bullish in the coming days."

Meanwhile, Indian equity benchmarks extended their winning run for the fourth straight session, led by gains in banks, financials, consumer goods and technology stocks.