Pharmaceutical major Wockhardt is planning to demerge its business of new chemical entities (NCE), original new drugs in the pipeline and in-licensed drugs from other companies and biotech drugs like insulin into a new company.
It would seek in-principle approval of the board to demerge its NCE research and development and certain high value products, subject to the approval of shareholders and other regulatory authorities, the company said in a release issued to the BSE today.
Wockhardt is in talks with various private equity (PE) funds and is also working on a qualified institutional placement (QIP) to fund the new entity, the release added.
When contacted, a spokesperson for Wockhardt declined to comment. Chairman Habil Khorakiwala was not available for comments.
Sources said Wockhardt's new company would inherit three NCEs under clinical trial stage development. This includes WCK 771, an antibiotic for various diseases that is now in Phase-II advanced human clinical trials, WCK 1152, a drug to treat respiratory tract infections including hospital-acquired infections and WCK 2349, an anti-fungal drug under Phase-I development. Wockhardt also has about four pharmaceutical compounds in the pre-clinical development stage.
The company also has an advanced research and development centre at Aurangabad, employing over 500 scientists, started two years ago with an investment of over Rs 50 crore.
Sources said a major attraction for the investors in the new company would be its rich biotech drug portfolio to be transferred from Wockhardt. It has already developed some fast moving drugs like Biovac-B, a hepatitis B vaccine, anaemia drug Wepox (recombinant erythropoietin), insulin branded as Wosulin and Glargine, a novel long acting insulin. These products, developed in the last few years through in-house research and developments, are likely to move to the new company, sources added.
Understanding Short Term Trading
Before I begin, this blog is not for intraday traders. My definition of short term implies duration of around 2 to 3 months.
Short Term stock picking is no rocket science, but rather a visual interpretation of technical charts. A basic moving average on a time frame chart will show the direction of the securities movement.
Moving averages is a mathematical results calculated by averaging a number of past data points. Moving averages (MA) in it's basic form is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. Once the value of MA has been calculated, they are plotted onto a chart and then connected to create a moving average line. Typical moving averages used for short term trading are 50 MA and 100 MA.
Types of Moving Averages
1) Simple Moving Average (SMA)
SMA is calculated by taking the arithmetic mean of a given set of values on a rolling window of timeframe. The usefulness of the SMA is limited because each point in the data series is weighted the same, regardless of where it occurs in the sequence. Critics argue that the most recent data is more significant than the older data and should have a greater influence on the final result.
2) Exponential Moving Average (EMA)
EMA overcomes the limits of SMA, where more weight is given to the recent prices in an attempt to make it more responsive to new information. When calculating the first point of the EMA, we may notice that there is no value available to use as the previous EMA. This small problem can be solved by starting the calculation with a simple moving average and continuing on with calculating the EMA.
The primary functions of a moving average is to identify trends and reversals, measure the strength of an asset's momentum and determine potential areas where an asset will find support or resistance. Moving averages are lagging indicator, which means they do not predict new trend, but confirm trends once they have been established.
A stock is deemed to be in an uptrend when the price is above a moving average and the average is sloping upward. Conversely, a trader will use a price below a downward sloping average to confirm a downtrend. Many traders will only consider holding a long position in an asset when the price is trading above a moving average.
In general, short-term momentum can be gauged by looking at moving averages that focus on time periods of 50 days or less. Looking at moving averages that are created with a period of 50 to 100 days is generally regarded as a good measure of medium-term momentum. Finally, any moving average that uses 100 days or more in the calculation can be used as a measure of long-term momentum.
Support, resistence and stoploss can be infered by referring the closet MA below or above the market price. The other factor that is used in short term momentum is the trading volume. The moving averages along with the trading volume can provide a better insight to short term movement.
Markets are moved by their largest participants - I believe this is the single most important principle in short-term trading. Accordingly, I track the presence of large traders by determining how much volume is in the market and how that compares to average. Because volume correlates very highly with volatility, the market's relative volume helps you determine the amount of movement likely at any given time frame--and it helps you handicap the odds of trending vs. remaining slow and range bound.
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