Aurobindo Pharma Q1 Review – Product Development, Capacity Build-Up Underway For Niche Products: Motilal Oswal

Aurobindo Pharma Ltd. delivered in-line quarter at operational level. The company posted strong YoY growth in the anti-retroviral/rest of world segments and reported growth in the U.S. segment despite intensified competitive environment.

We cut our earnings per share estimates by 9%/3% for FY23/FY24, respectively, to factor in:

1. moderation in the Europe outlook,

2. higher operational cost and

3. lower other income.

We remain positive on Aurobindo Pharma aided by its:

1. strong abbreviated new drug application pipeline comprising limited competition products in oncology, biosimilars, topicals, transdermal patches, etc. and

2. ongoing efforts to improve the profitability of the Europe business.