Vivimed Labs Did Not Disclose Transfer and Sale of Business Units, Twice
Vivimed announced its limited review results of Q3 FY16-17 on 14 February 2017 and reported a revenue of Rs363 crore (O2 FY17 - Rs300 crore) and a profit after tax (PAT) of Rs52 crores (Q2 FY16-17 - Rs26 crore). The revenue included Rs73 crore of business transfer agreement (BTA) with Ordain Health Care Ltd of Klarsehen Pvt Ltd, which was a one-time sale of an entire product line, mentioned in the annual reports. There were no specific disclosures in the results.
This was disclosed only in the annual report, which is released six months after the year-end. As per as per the accounting standards, Vivimed should have disclosed the sale of such a product line as 'discontinuing operations' and should give a clear break up of continuing operations and discontinuing operations in its press release. 
It failed to make the disclosure and even auditors did not qualify their audit report for violation of accounting standards. It is price sensitive information and requires specific disclosure to the stock exchanges. Vivimed failed to disclose this to stock exchanges.
For Q4 FY16-17 Vivimed reported a revenue of Rs440 crore and a PAT of Rs115 crore. There was no other disclosure in the limited review results. The results gave the impression that the revenue and PAT numbers were growing and margins are expanding. 
However, the revenue included Rs163 crore of net consideration for the slump sale of manufacturing units located at Bonthapally, Medak District for a consideration of Rs380 crore to Clariant India Ltd. Selling of facility is price sensitive information and as per accounting standards and under SEBI (Listing Obligations and Disclosure Requirements), Vivimed should have disclosed this to the stock exchanges. Vivimed didn’t.
We asked Vivimed how such important disclosures were missed out. Yugandhar Kopparthi, company secretary & compliance officer, promised to reply but hasn’t even after about three weeks. As and when we receive their reply we will add to the article. It is shocking that a large listed company and its auditors can openly violate securities laws, regulations and accounting standards.
Vivimed Lab claims to be an integrated pharmaceutical company and manufactures of active pharmaceutical ingredient (APIs) and formulations for various therapeutic areas. The company's (API) business comprises of generic/ regulatory APIs and APIs for the contract development and manufacturing organisation (CDMO) segment. 
This constitutes 70% of its total pharmaceutical business and the balance is contributed by the finished dosage formulations (FDFs) segment. The company is weighed down by debt. For the June quarter, revenues were down by 5% and net profit was down by 180%.
Vivimed Labs closed Monday around 15% higher at Rs17.30 on the BSE, while the benchmark Sensex ended the day marginally up at 37,145.
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    Nifty, Sensex Upmove May Continue – Monday closing report
    We had mentioned in Friday’s closing report that Nifty, Sensex were on course to head higher. The major indices ended with gains. On the NSE, there were 1,167 advances, 608 declines and 358 unchanged. The trends of the major indices in the course of Monday’s trading are given in the table below:
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    The Buildings & Factories business of L&T Construction has secured a prestigious residential project from the City and Industrial Development Corporation of Maharashtra Limited (CIDCO) to construct 23,432 dwelling units with on-site infrastructure works at various locations in Navi Mumbai. The project, being part of the Pradhan Mantri Awas Yojana (PMAY), envisages construction of Economically Weaker Section (EWS) and Low-Income Group (LIG) type of dwelling units. The building configurations vary from 13 to 20 storeys.
    The top gainers and top losers of the major indices are given in the table below:
    The closing values of the major Asian indices are given in the table below:
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    Nifty, Sensex On course to Head Higher - Weekly Closing report
    We had mentioned in last week’s closing report that Nifty, Sensex may head higher. The major indices were volatile and closed with losses this week. The trends of the major indices in the course of the week’s trading was:
    The equity markets were closed on Monday on account of Ganesh Chathurthi.
    On Tuesday, the major indices suffered a deep correction. On the NSE, there were 569 advances, 1,199 declines and 357 unchanged. Investor panic over the country's lower than expected GDP growth figure of 5% in the first quarter ending June, released last week, led the key market indices to decline by over 2% on Tuesday.
    Ashok Leyland reported a 47% decline in total commercial vehicle sales at 9,231 units in August. The company had posted sales of 17,386 units in the year-ago month, Ashok Leyland said in a statement. The medium and heavy commercial vehicle sales stood at 5,349 units last month as against 13,158 units in August 2018, down 59%. Maruti Suzuki India reported a 33.99% decline in production in August at 111,370 vehicles against 168,725 produced in the year-ago month. The company had produced 133,265 units in July, down from 178,533 units reported for the corresponding month of the last financial year (FY19). Of the total sales, domestic off-take declined nearly 36% to 94,728 vehicles. Domestic passenger vehicle sales were down 36.1% at 93,173 units from 1,45,895 vehicles during the corresponding period last year. 
    Steel Strips Wheels has achieved August 2019 total wheel rim sales of 10.72 lakhs Vs 14.14 lakhs in August 2018 representing a decline of 24% YoY. The August month saw continued cut in inventory and production from auto makers to further rationalize the inventory. SSWL has achieved gross turnover of Rs131.96 crore in August 2019 vs. 217.77 crore in August 2018, there by recording fall of 39.40% and achieved net turnover of Rs109.76 crore in August 2019 vs. Rs.166.41 crore in August 2018, a fall of 34%. KNR Constructions has received a work order for Rs850 crore from Megha Engineering & Infrastructures Limited, Hyderabad for construction and completion of earthen bund works which are part of Kaleshwaram Project-Formation of Sri Komuravelli Mallanna Sagar.
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    The Board of Canara Bank will meet on 13 September to consider the amalgamation of Syndicate Bank into Canara Bank. The board will consider capital infusion up to Rs9,000 crore by Government of India by way of preferential issue of equity shares subject to necessary approvals. Gujarat Alkalies and Chemicals may consider the proposal for split/sub-division of its equity shares of the face value of Rs10/- each of the Company. ICRA has revised the long term rating of Indoco Remedies to A from A+. The outlook on the long-term rating is negative. The short term rating has been revised to A2 from A1. 
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