US FDA completes Aurobindo's Unit 4 audit; to help boost US biz

Of the total incremental growth of the company, 60-70 percent will be coming from this unit, he added.Below is the verbatim transcript of Surajit Pal’s interview to Sumaira Abidi and Surabhi Upadhyay on CNBC-TV18. Surabhi: How critical is this? This audit getting completed with just 2-3 observations. What kind of an impact could it have in terms of numbers? A: These are very good news for the company because mind it this plant has almost 26 percent of the pending approval and I would say those 26 percent is very important because those are the major drivers for the US business. So, these two - which I understood talking to the company - will not stop or impede any kind of approval for the company. So, it will maintain its flow of approval and launches in injectables. Surabhi: You mentioned that it represents that percent in terms of pending approvals. In terms of revenue contribution what is this plant's contribution to their total pie? A: Currently it contributes USD 88 million but next year my assumption is that it could be USD 160 million plus. So, you can understand is that more than USD 1 million sales whatever the growth will be coming that major 60-70 percent of that incremental growth coming from this unit. Sumaira: What does this then mean for your rating on the stock and what is the target that you see for Aurobindo? A: My recommendation maintain at buy and my target price is Rs 943. Sumaira: Has it been hiked post this audit? A: No, I will not hike now unless and until there is a major development in terms of filing and approval but this shows that my assumptions will not be disturbed because of delay or any kind of restriction of approvals.