Aurobindo Pharma shares crash 9.5% as USFDA issues 5 observations for arm's AP facility

So far this year, the stock of this pharma player has cracked over 15 percent

Shares of Aurobindo Pharma tumbled 9.5 percent to Rs 1,053 on February 19 after the US FDA completed a pre-approval inspection of its subsidiary, Eugia Steriles, issuing five procedural observations.

The inspection took place from February 10-18, wherein the US regulator concluded with five procedural observations, which the company plans to address within the prescribed time. Aurobindo Pharma stated that it will update the stock exchanges with further developments if necessary.

Last year in December, Aurobindo Pharma's Telangana API facility secured 2 observations from the USFDA. The FDA inspection was carried out between December 9 and December 17 at the facility run by Apitoria Pharma at Pashamylaram village in Patancheru mandal of Sanga Reddy district. Moreover, in September, the Telangana facility had received 10 observations from the US health regulator.

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In Q3FY25, Aurobindo Pharma's net profit declined 9.7 percent year-on-year (YoY) to Rs 845 crore, whereas revenue increased by 8.5 percent YoY to Rs 7,978 crore. The strong sales growth was supported by steady demand across key geographies, including the US and emerging markets.

Operating performance, however, remained subdued, with EBITDA falling 1.5 percent YoY to Rs 1,627 crore in the third quarter.

Aurobindo Pharma is principally engaged in manufacturing and marketing of active pharmaceutical ingredients, generic pharmaceuticals, and related services.

Around 18 brokerages cover Aurobindo Pharma shares, with 22 sharing "buy" ratings, 2 shared "hold" calls, and 1 put out "sell" rating on the counter. So far this year, the stock of this pharma player has cracked over 15 percent, as against 3 percent drop in the benchmark Nifty 50 index.

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