Goldman Sachs sees 40% upside in this multibagger pharma stock; should you buy?
NEW DELHI: Shares of Aurobindo Pharma were trading higher in early trade on Friday after global brokerage Goldman Sachs maintained a ‘buy’ rating on it with a target price of Rs 934, indicating a 40 per cent upside from the current level.
The scrip was trading 0.65 per cent higher at Rs 662.55 around 9.30 am (IST). Shares of the company opened at Rs 665.70 and touched a high and low of Rs 666.60 and Rs 660.50, respectively, in trade so far. Benchmark BSE Sensex was up 76.57 points, or 0.26 per cent, at 29,005.
Goldman Sachs believes new product launches in the US are gaining momentum, leading to a 14 per cent top line growth for Aurobindo Pharma. It further forecast a 19 per cent Ebitda growth over the next two years versus 12 per cent for peers. “Aurobindo Pharma is transforming from simple generics player into one with a complex generics portfolio,” the brokerage house said.
In the past five years, shares of Aurobindo Pharma have rallied 1,044 per cent, or 11 times, to Rs 658.25 as of March 9. The scrip was at Rs 57.55 on March 9, 2012. Benchmark BSE Sensex climbed 65 per cent during the same period.
For the quarter ended December 2016, the company reported a net profit of Rs 578.59 crore, up 6.30 per cent, against Rs 544.31 crore in the corresponding quarter last year. Net sales of the company climbed 11.69 per cent year-on-year to Rs 3844.47 crore for the quarter under review.
The scrip was trading 0.65 per cent higher at Rs 662.55 around 9.30 am (IST). Shares of the company opened at Rs 665.70 and touched a high and low of Rs 666.60 and Rs 660.50, respectively, in trade so far. Benchmark BSE Sensex was up 76.57 points, or 0.26 per cent, at 29,005.
Goldman Sachs believes new product launches in the US are gaining momentum, leading to a 14 per cent top line growth for Aurobindo Pharma. It further forecast a 19 per cent Ebitda growth over the next two years versus 12 per cent for peers. “Aurobindo Pharma is transforming from simple generics player into one with a complex generics portfolio,” the brokerage house said.
In the past five years, shares of Aurobindo Pharma have rallied 1,044 per cent, or 11 times, to Rs 658.25 as of March 9. The scrip was at Rs 57.55 on March 9, 2012. Benchmark BSE Sensex climbed 65 per cent during the same period.
For the quarter ended December 2016, the company reported a net profit of Rs 578.59 crore, up 6.30 per cent, against Rs 544.31 crore in the corresponding quarter last year. Net sales of the company climbed 11.69 per cent year-on-year to Rs 3844.47 crore for the quarter under review.
