Last Thursday, the stock price of Propanc Health Group Corp (OTCMKTS:PPCH) made an impressive attempt for recovery. Lately, the stock price had taken a hit, declining more than 50% from its newfound highs. On Thursday, the prices jumped almost 23% to record a strong trading session. However, the week ended on a weak note, with the stock price closing in red once again. It declined around 8% to close the week on $0.039.

The momentum

It continued with its decline in last trading session, as it dropped more than 5% to close the day at $0.0370. The decline came at a share volume of 3.90 million much lower than the average volume of 27.24 million. The prices faced a stiff resistance at its 200-day moving average. Propanc Health posted gains in early April on announcement that It will be featured in the reputed NY Times Sunday Magazine.

The numbers

Propanc financial reports highlight several factors that could act as red signs for cautious investors. The major problem once again is of the massive dilution as it is with most of the OTC traded firms. Last October, Propanc reported 82 million common shares as outstanding and by February this count has surged by almost 130%, to massive 191 million. The increase in outstanding shares by more than 100% in just a quarter is a case of massive dilution.

The debt

On April 15, Propanc announced that it will be repaying outstanding convertible ‘Notes’ in next two months. James Nathanielsz, the Chief Executive Officer said that there has been ongoing speculation on funding sources of capital, and the management is delighted to assure the company’s shareholders that they have found investors who are ready to help with repaying outstanding debts. The company remains committed to reduce share dilution. However, the outstanding shares count as recorded in February highlights a different story.