Aurobindo Pharma Ltd - Weak Performance - Maintain Accumulate - Emkay

Reco: ACCUMULATE
CMP: Rs 110
Target Price: Rs 160

- Q1FY13 results were below expectations. Revenues up 14% to Rs12bn, EBITDA down15% to Rs1.4bn and APAT (adj. for forex loss of Rs2.06bn) was down 53% to Rs500mn.

- International revenues (contributed 70%) declined due to loss of revenues from Pfizer & other partners in spite of 2 big launches in US i.e. Plavix & Combivir.

- Margins were depressed because of higher staff and other expenses as the company is trying to create its own distribution network in regulated markets vs. partnership model earlier.

- Going forward, company plans to launch 25 products in US which will improve operating performance - maintain Accumulate with a target price of Rs160.

Source : Equity Bulls

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