Aurobindo Pharma Ltd. share price target

US business shines; EU surprises positively: US business sales grew 25% YoY and 24% QoQ to USD327m. The strong sequential growth is attributed to Renvela ramp-up (USD50m-55m), growth in injectables business (up USD11m QoQ on the back of launches and benefits from shortage of few drugs), ramp-up of other key launches including Nexium OTC, Strattera, Meropenem, Mucinex, and Ebzicom. We expect gRenvela tablet sales to decline, as it has become a 5-player market. The lower gRenvela tablet sales will be partially offset by ramp-up in injectables business (quarterly run rate...

Strong growth in key markets; maintain Buy We maintain our Buy rating on Aurobindo Pharma (APL) and revise TP to Rs1,030 (earlier Rs970) based on 18x March'19E EPS of Rs57.1. The company's Q2FY18 results exceeded our and consensus expectations. APL's sales grew 18% YoY, margin improved 60bps to 25.2%, and net profit grew 29% YoY. Its specialised segments such as injectables, penam, microspheres, hormones, oncology, neutraceutical, depot injections and peptides would improve margins due to complexity in the manufacturing. APL has developed a robust pipeline of 463...

ICICI Securities Ltd | Retail Equity Research Revenues increased 18% YoY to | 4436 crore (I-direct estimate: | 4189 crore) mainly due to strong growth in the US and Europe. The US revenue grew 21% YoY to | 2099 crore (I-direct estimate: | 1957 crore) mainly due to launched of limited competition product Sevelamer carbonate (nephrology). Europe revenues grew 37% YoY to | 1114 crore (I-direct estimate: | 997 crore). EBITDA margins improved 58 bps YoY to 25.2% (I-direct estimates:...

appears to be the first guidance published where USFDA has taken cognizance of the need to provide a platform for accelerated development of complex generics. The draft seeks to lay a pathway for discussions between the agency and generic filers, both pre and post ANDA filing. Note that the guidance is only a draft with comments invited from companies; a final guidance document will be issued in due course. The move by the USFDA by itself is unlikely to change things immediately but in the longer term reflects its focus on ensuring accelerated drug approvals, which will translate into intensified pricing pressure even in complex drugs that are hitherto seen as the only secure...

Better Q1FY18 performance compared to its peers Aurobindo Pharma (Auro) is one of the largest vertically integrated pharmaceutical companies. Over the past few years, the company has drastically shifted its focus...

Gross margin improved 50 bps QoQ and EBITDA margin 170 bps QoQ on 8% QoQ growth in US sales and improving revenue mix (higher formulations and lower API/ ARV sales). However, PAT declined 11% YoY/ 3% QoQ on higher depreciation due to commissioning of new units.

For 1QFY2018 Aurobindo Pharma (APL) posted numbers lower than expectations on sales, OPM and net profit fronts. On sales front, the company posted sales of `3621cr (v/s. `3,900cr expected) v/s. `3,664cr in 1QFY2017, posting a yoy de-growth of 1.2%. On the operating front, the EBITDA margin came in at 21.1% (v/s. 22.9% expected) v/s. 22.6%..

declined by 1.3% YoY due to flattish growth in the US, negative contribution from ARV (-19% YoY) and API (-15% YoY) business. EBITDA for the quarter stood at Rs 8.4bn (est. Rs 8.6bn) down 5.3% YoY with EBITDA margins at 22.9% vs 23.9% the same period year ago. PAT for the quarter stood at Rs...

Aurobindos revenues grew remained flat q-o-q and y-o-y at Rs 37,008 mn in 1Q FY18 falling short of our expectations. Revenue growth was dampened by poor offtake in ARV and API business during the quarter. API business was negatively impacted by destocking in lieu of GST implementation during the quarter. Adjusted EBITDA increased 16.2% q-o-q but decreased 4.5% y-o-y to Rs 8,637 mn during 1Q FY18. Adjusted EBITDA margin increased 306 bps q-o-q but decreased 58 bps y-o-y to 23.3% in 1Q FY18 mainly due to higher than expected Cost of...

Maintain BUY rating with a revised TP of Rs 790 (16x Jun19E). A favourable business mix in 1QFY18 led to Aurobindos (ARBP) EBITDA margin beating estimates by ~130bps. Lower contribution from APIs drove gross margin up ~180bps. The top-line declined ~2% vs our estimates of ~3% growth, largely on account of reduction in the API (owing to the GST disruption) and ARV businesses. The US business was flat YoY, and the European biz (+10% YoY) was boosted by sales from the Generis acquisition. PAT at Rs 5.1bn was down 17%YoY, in-line with estimates.