BackAurobindo Pharma share price rises more than 1% on regulatory clearance of manufacturing facilities
Stock Market today- Share price of Aurobindo Pharma gained as regulatory clearance of plants lifted sentiments. The US sales contribute more than half to Aurobindo's sales and compliance of manufacturing units to the norms laid by the US drug regulator on good manufacturing practices is important.
PremiumThe news on the successful Completion of US FDA Inspection at Unit I & III of Aurobindo Pharma Ltd lifted investor sentiments and the share prices gained of Aurobindo Pharma gained more than 1% in morning trades on Monday, on a day when benchmark indices were trading in red.
Aurobindo Pharma in its filing on the exchanges said that United States Food and Drug Administration (US FDA) conducted a Pre-Approval Inspection (PAI) at Unit-I & III, Formulation manufacturing facility, of APL Healthcare Ltd., a wholly owned subsidiary of the Company, situated in the Mahabubnagar District, Telangana,, from November 13 to 17, 2023. The inspection closed with zero observations and a classification of “No Action Indicated" (NAI).
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The regulatory clearance of manufacturing facilities by the US drug regulator remains crucial for companies as Aurobindo Pharma, that has high dependance on exports to the US. US sales contribute more than half to Aurobindo’s total revenues. The prospects of the Aurobindo Pharma remain strong in the US markets due to a promising pipeline of injectables and other limited competition products. However regulatory clearances are important for continued exports of the products to the US.
Analysts have maintained a positive outlook for Aurobindo. Analysts at Axis Securities in their results review repot had said Aurobindo Pharma has several growth levers in place. These are Generic injectables, Eugia ($520 Million sales) that could grow by low double-digit growth based on value-added approval. The launch of Trastzumab biosimilars in 2FY24E, The launch of Pen–G injectible in Q1FY25 estimated and One-time opportunity in generic Revlimid in the next 2-3 years. Revlimid generics have already been launched by the company.
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Others as those as Motilal Oswal financial Services have raised their earnings estimates by 6% and 5% for FY24 and FY25 respectively, factoring in: the benefit from reduced price erosion in the base portfolio, and improved operating leverage.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
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