Morepen Labs surges 18% in 2 days. Here's why

NEW DELHI: Morepen Laboratories on Thursday gained for the second straight session after its board approved raising of Rs 433 crore through issue of preferential shares to Switzerland's private venture capital firm Corinth Investment Holdings and promoter group firm Liquid Holdings.

The stock also gained on news that the Morepen Group sealed a total investment of $100 million from Corinth Group.

Earlier this week, the Securities Appellate Tribunal set aside a Sebi order that had barred Morepen Laboratories from the capital markets for one year.

In a separate development, a top company official told PTI that the company was betting big on the diagnostics devices segment, while building its presence in the active pharmaceutical ingredient (API) segment.

The stock, which surged 9.42 per cent on Wednesday, advanced another 7.7 per cent to hit a high of Rs 59.45 in Thursday’s trade. This took the two-day gain for the stock to 18 per cent.

Morepen Laboratories' board approved issue of up to 5.85 crore equity shares to Corinth Investment Holdings AG, a Switzerland-based entity that belongs to the public category. The shared will be issued at Rs 41.60 per share, a 10 per cent discount to market price, for an aggregate amount up to Rs 243.36 crore.

It also approved issue of up to 5 crore equity shares to Liquid Holdings, an entity belonging to the promoter group of the company, at a price of Rs 38 per equity shares, for an aggregate amount of up to Rs 190 crore.

The company said an extraordinary general meeting of the members of the company will be held on May 20 to seek approval for the said preferential issue.

Morepen Laboratories said its board approved the investment proposed by Corinth Group to the extent of $32.50 million (about Rs 243.36 crore) in the parent company Morepen Laboratories, out of a total $100 million investment in the promoter group, subject to approval of the shareholders and other regulatory bodies.