According to Daljeet’s note, the management has asserted that the business is “normal”. What, then, is contributing to the weakness in the stock which culminated in yesterday’s savage fall?
The stock recovered a bit today (8%) but over the past 3 months, it has lost 51%. The loss in the last month is itself 33%.
As expected, the MMB punters are agog with excitement and are floating various theories to explain the catastrophe. According to one theory doing the rounds, some big-ticket speculator has been caught on the wrong foot. He bought a ton of the stock with borrowed funds in the hope of making a quick buck. However, the weakness in the stock has put paid to his aspirations. The margin money financiers are now dumping the stock to recover their funds.
Another theory doing the rounds is that the FDA has either disapproved the Company’s application or it will be delayed indefinitely and that this will be a long-term negative for the company. It is implied that knowledgeable insiders are gently easing off the stock.
Of course, we must remember that all of this is wild and baseless rumors with zero credibility. We will have to wait for Daljeet’s advisory to know what is happening with the stock.
Unfortunately, Daljeet came in for a bit of stick from a few disgruntled punters, with one of them suggesting that he should be “reported to SEBI”, whatever that means. However, several punters rushed to Daljeet’s defence by pointing out that several of his picks are winners and that he could not be condemned for a few that had flopped. Of course, Daljeet is a veteran in the game and goes about his job sincerely, unaffected by what the punters say, or do not say.