Niche products led earnings growth

Company
11 Mar 2024
5 Min read 
  • Aurobindo Pharma's 3QFY24 performance exceeded expectations, driven by niche products and improved margins.
  •  The company is implementing measures to address issues highlighted by USFDA at Eugia Unit-3.
  •  Earnings estimate for FY25/FY26 increased by 3% due to cost savings and enhanced profitability.
  •  Aurobindo Pharma is working on strengthening its ANDA pipeline, building a biosimilar portfolio, and enhancing sales and earnings growth.
  •  The stock is rated as Neutral with limited upside from current levels.
  •  Sales CAGR of 10% expected over FY24-26, with robust growth in the US and EU markets.
  •  EBITDA margin expected to expand over FY24-26.
  •  EPS CAGR of 17% expected over FY24-26.
  •  Valuation at 16x 12M forward PE, with a price target of INR1,080.
  •  Neutral stance on the stock due to limited upside.
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