Suven Life Sciences spurts on stake sale buzz

Suven Life Sciences was locked at upper limit of 20% at Rs 46.55 on BSE on reports that firm was in talks with two private equity firms to dilute up to 10% stake.

On BSE, 66.18 lakh shares of the scrip were traded. The stock had an average daily volume of 1.76 lakh shares on BSE in past one quarter.
The scrip had touched a low of Rs 38.85 so far during the day. The stock had hit a 52-week high of Rs 46.90 on 20 August 2007 and a 52-week low of Rs 27.08 on 20 December 2006.
The scrip had outperformed the market in the one month to 17 December 2007, adding 19.38% as against the Sensex's 2.22% decline. It had also underperformed the market in the past three months, gaining 5.58% against the Sensex's 22.93% rise.
The small-cap firm has an equity capital of Rs 11.56 crore. Face value per share is Rs 1.
At the current price of Rs 46.55, the scrip trades at a PE multiple of 116.37, based on Q2 September 2007 annualised EPS of Rs 0.40.
Suven Life Sciences reportedly plans to raise up to $30 million by March 2008 through an issue of shares to private equity and a convertible bond issue to fund its drug discovery programme.
According to reports, the money raised through the issue would be used to fund the development of Suven's experimental drug compound SUVN-502, which enters the initial phase of clinical trials in January 2008. SUVN-502 is being developed as a possible treatment for Alzheimer's Schizophrenia and cognition-related disorders.
A part of the proceeds would also be used to develop its drug discovery infrastructure in Hyderabad to strengthen its collaborative research services, the report added.
Suven Life Sciences’ net profit fell 53.4% to Rs 1.16 crore on 0.1% decline in sales to Rs 27.84 crore in Q2 September 2007 over Q2 September 2006.
Suven Life Sciences’ principal activity is to design, manufacture and the supply of bulk active, drug intermediates and fine chemicals to the life science industry. The company mainly operates in the USA, Europe, Asia and India.

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