(Bloomberg) -- The troubles have been adding up for IHH Healthcare Bhd., wiping almost $800 million from its market value over three sessions.
A whipsawing Turkish lira, a major shareholder cutting its stake, and continued uncertainty over a plan to buy Fortis Healthcare Ltd. have led IHH to fall 6.6 percent in the three days through Tuesday while the benchmark index was largely flat. Shares rebounded 2.5 percent today after the stock's 14-day relative strength index sank into oversold territory for the first time since November.
The lira's roller-coaster ride that began on Friday may weigh on the company's Turkish unit Acibadem Saglik Yatirimlari Holding AS and worsen non-lira liabilities, Nomura Securities Co. analyst Raghavendra Divekar wrote in a March 28 note. IHH said last month it's looking to repay $250 million of non-lira debt to manage foreign exchange exposure at Acibadem.
IHH may also be under pressure after the Employees' Provident Fund sold 1.8 million of the company's shares last week. Malaysia's biggest pension fund has lowered its stake in IHH to 7.46 percent, from 8.44 percent at the end of 2018, according to stock exchange filings.
Meanwhile, IHH's planned acquisition of Fortis remains in limbo after India's top court put it on hold. Daiichi Sankyo Co. had filed a suit against Fortis to recover $500 million from the founders and ex-owners of the embattled hospital chain. Any adjustments made due to the ongoing probes against Fortis may affect the provisional goodwill value of the company, according to an April 1 report by IHH's auditor KPMG.
"IHH does not see meaningful risk from the auditors' latest qualified opinion on Fortis," Credit Suisse analysts Ari Jahja and Samuel Pratama wrote in a note on Tuesday, after talking to IHH's investor relations department. IHH's management "expects healthcare demand in Turkey will likely remain resilient," the note said.
To contact the reporter on this story: Abhishek Vishnoi in Singapore at avishnoi4@bloomberg.net
To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Yudith Ho, Teo Chian Wei
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