Shares of this micro-cap company hit the 5 percent upper circuit after the company entered into a Business Transfer Agreement worth Rs 45.50 crores with a Private company for its business operations.
With a market capitalization of Rs 131 crores, the stocks of Fortis Malar Hospitals Limited started their trading session on Tuesday at Rs 72.64 hitting the 5 percent upper circuit. In the past six months, the company’s stock has delivered returns of over 40 percent.
Such sharp movements in the stock prices were observed after the company, through a regulatory filing with the exchange, informed that it has signed a Business Transfer Agreement (BTA) with ‘MGM Healthcare Private Limited’, a healthcare delivery service provider.
The agreement pertains to the sale of its business operations at Fortis Malar Hospital located in Chennai, Tamil Nadu. The consideration for the same is decided to be Rs 45.50 crores (all-cash deal) and is expected to be consummated by the end of January 2024.
In addition, the ‘OPD’ and ‘Radio Diagnostics’ business operations are also being divested by two wholly owned subsidiaries of Fortis Healthcare Limited, viz, ‘Fortis Health Management Limited’ and ‘Hospitalia Eastern Private Limited’ to MGM.
“Upon consummating the transaction, the Board will endeavor to distribute the available surplus funds to shareholders as appropriate and in the most optimal manner as per applicable laws, rules and regulations.”, commented Mr. Daljit Singh, Non-Executive Chairman, Fortis Malar Hospitals Limited.
During the recent financial quarters, the company has shown positive movements as far as the operating revenues and bottom-line numbers are concerned.
The operating revenues increased marginally from Rs 17 crores during Q1FY23-24 to Rs 18 crores during Q2FY23-24, and, the latter, during the same period, reduced the losses from Rs 2 crores to about a crore.
According to the shareholding pattern data available for the quarter ended September 2023, the company’s Promoters hold a 62.71 percent stake, Public (retail) investors hold a 37.23 percent stake, and the Domestic Institutional Investors (DIIs) hold the remaining stake of 0.07 percent in the company.
Fortis Malar Hospitals Limited is a company based in India that is engaged in the business of providing healthcare services. The company focuses on providing medical care pertaining to neurosurgery, orthopedics, pediatrics, internal medicine, and many more.
Written by Amit Madnani
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