Prabhudas Lilladher's research report on Aurobindo Pharma
Our FY24/25E EPS est. stands increased by ~5% to factor in higher margins and US sales. Aurobindo Pharma’s (ARBP) Q2FY24 EBITDA of Rs14bn (up 22% QoQ) with OPM of 19.4% (up 250 bps QoQ) was 14% above our estimate. We expect margin trajectory to further improve. Pick up in US sales hinge on timely niche approvals along with stabilization of pricing pressure in the base business. We believe ARBP has multiple growth drivers in place with investments in vaccines, injectables, biosimilars and PLI which are expected to be reflected from FY25.
Outlook
At CMP, the stock is trading at 16.5x FY25E P/E. We value company at 16x Sept 2025E EPS and assign a TP of Rs1,065/share (Rs900 earlier). Maintain ‘Accumulate’ rating
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