Aurobindo Pharma stock up 40% over last 3 months
The stock of Aurobindo Pharma has appreciated over 40% over the last three months. The company has received three approvals from US FDA in the month of September.
By Kiran Kabtta Somvanshi, ET Bureau | Updated:
MUMBAI: The stock of Aurobindo Pharma has appreciated over 40% over the last three months. The company has received three approvals from US FDA in the month of September.
On back of the recent drug approvals and the possibility of US FDA approval for its manufacturing units IV and VI, the prospects of the company are looking bright and promising.
Edelweiss in its recent report on Aurobindo has revised the company's earnings by 12-13% citing factors like new drug launches in the US market, launch of injectible products from its unit IV and VI on getting approval from US FDA and capacity expansion.
The company has received ten new drug approvals from the US FDA in the last six months. The drugs together have a potential market size of $ 18,860 million. BY the ned of this year, the company's unit IV is expected to get FDA approval and the unit VI is likely to see resolution of the import alert issues with US FDA. Once the units get approval from the US FDA, it will meaningfully start contributing to the company's topline and bottomline.
At the end of June, the company had a net debt of Rs 3400 crore - of which Rs 1670 is in the form of ECB and FCNRB and around Rs 1870 is more perpetual in nature as it is working capital loans. The average cost of borrowing is expected to be around 3.5% in FY13.
According to the Edelweiss report, there is scope for margin expansion on account of the above factors. The EBITDA margins are likely to increase to 16-18% by FY14 from 13.5-14% expected in FY13.
On back of the recent drug approvals and the possibility of US FDA approval for its manufacturing units IV and VI, the prospects of the company are looking bright and promising.
Edelweiss in its recent report on Aurobindo has revised the company's earnings by 12-13% citing factors like new drug launches in the US market, launch of injectible products from its unit IV and VI on getting approval from US FDA and capacity expansion.
The company has received ten new drug approvals from the US FDA in the last six months. The drugs together have a potential market size of $ 18,860 million. BY the ned of this year, the company's unit IV is expected to get FDA approval and the unit VI is likely to see resolution of the import alert issues with US FDA. Once the units get approval from the US FDA, it will meaningfully start contributing to the company's topline and bottomline.
At the end of June, the company had a net debt of Rs 3400 crore - of which Rs 1670 is in the form of ECB and FCNRB and around Rs 1870 is more perpetual in nature as it is working capital loans. The average cost of borrowing is expected to be around 3.5% in FY13.
According to the Edelweiss report, there is scope for margin expansion on account of the above factors. The EBITDA margins are likely to increase to 16-18% by FY14 from 13.5-14% expected in FY13.
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