Elara Capital, a prominent brokerage firm, has upgraded its rating on Aurobindo Pharma from “Accumulate” to “Buy” with a revised target price of ₹1,568 per share. This upgrade comes on the heels of the company’s strong Q2 FY24 performance, driven by robust growth in the US generics market and improved profitability. Elara Capital anticipates continued growth for Aurobindo Pharma, citing factors such as:
- New product launches: A strong pipeline of new product launches in the US market is expected to boost revenue.
- Market share gains: The brokerage firm believes Aurobindo Pharma is well-positioned to capture additional market share in the US generics segment.
- Improving margins: Operational efficiency and favorable pricing trends are likely to support margin expansion.
Key Insights:
- This upgrade by Elara Capital signifies growing confidence in Aurobindo Pharma’s future prospects.
- The focus is on the company’s strong performance in the US generics market, which is a key driver of its overall growth.
- The positive outlook is supported by factors such as new product launches, market share gains, and improving margins.
Investment Implications:
- The upgrade to “Buy” suggests that Elara Capital sees significant upside potential for Aurobindo Pharma’s stock.
- Investors with a medium to long-term horizon may consider adding Aurobindo Pharma to their portfolio.
- However, investors should also be mindful of potential risks, such as increased competition in the generics market and regulatory challenges.
