ICICI Direct is bullish on Aurobindo Pharma has recommended buy rating on the stock with a target price of Rs 915 in its research report dated September 07, 2018.
ICICI Direct's research report on Aurobindo Pharma
Aurobindo has entered into an agreement with US based Sandoz Inc. (generics / biosimilars arm of Novartis AG) to acquire its US Dermatology and Oral solid businesses for a consideration of US$ 900 million. Acquired portfolio comprises of 1) Portfolio of dermatology and oral solids, 2) authorised generics and in-licensed products, branded dermatology products (~US$ 50 million), 3) three manufacturing facilities at Hicksville - NY (Derma), Melville – NY (Derma) and Wilson- NC (OSD) besides entire holding in Eon Labs Inc., a wholly owned subsidiary of Sandoz.
We have rolled over our estimates to FY21 to capture the synergy of this deal. We have also upgraded our currency expectations. Accordingly, our new target price arrives at Rs 915 based on 15x FY21E EPS of Rs 61.2
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