Prabhudas Lilladher's research report on Aurobindo Pharma
Our FY24/25E EPS est. stands increased by 6%/4% to factor in higher margins. Aurobindo Pharma’s (ARBP) Q4FY23 EBITDA of Rs10bn (up 5% QoQ) with OPM of 15.5% (up 60 bps QoQ) was in-line with our estimate. We expect margin trajectory to further improve from FY24. Pick up in US sales hinge on timely niche approvals along with stabilization of pricing pressure in 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 FY24.
Outlook
At CMP, stock is trading at 12x FY25E P/E. We reiterate our ‘Buy’ rating with revised TP of Rs660/share (Rs565 earlier), based on 13x FY25E EPS.
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