Aurobindo Pharma share price surges 17% after FDA's VAI status for Hyderabad unit
The US regulator determined the inspection classification of the company's Hyderabad unit as Voluntary Action Indicated (VAI), the company said in a filing to the exchanges.
April 21, 2020 / 11:12 AM IST
The share price of pharmaceutical company Aurobindo Pharma surged 17 percent, hitting the upper circuit of Rs 594.60 per share on the BSE in the morning trade on April 21.
The US Food and Drug Administration has determined the inspection classification of the company's general injectable formulation facility at Pashamylaram in Hyderabad as Voluntary Action Indicated (VAI), the company said in a filing to the exchanges.
"US business is being driven by new approvals from a large pending pipeline coupled with a diversified product portfolio. With Sandoz deal called off, debt concerns have receded and earnings growth can sustain in high single digit over FY20-22. Key reason for our optimism on the stock is the beaten down valuation at ~9x FY22 PE which is at a large discount to peers even adjusting for the lack of domestic business," said Bhavesh Gandhi, Lead Analyst, Institutional Equities, YES Securities.
Aurobindo Pharma also got the final approval from the US drug regulator to manufacture and market Fluoxetine Tablets, 10 mg and 20 mg. Fluoxetine tablets are generic version of Eli Lilly’s Prozac® tablets, the company added.
The stock has risen more than 82 percent in the last one month and was quoting at Rs 631.65, up Rs 91.10, or 16.85 percent at 11:11 hours.