External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Equity Bottom-Up

We expect revenue and PAT CAGR of 9.6% and 13.9% over the period FY20-FY23E and recommend 'BUY' with TP of Rs 1,100/share.
<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

We expect revenue and PAT CAGR of 9.6% and 13.9% over the period FY20-FY23E and recommend 'BUY' with TP of Rs 1,100/share.
Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

AUROPHARMA: Expect Revenue and PAT CAGR of 9.6% and 13.9%

External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

We tweak our estimates and revise TP to INR1,075/sh, based on 16x FY23e EPS and NPV of INR50 for the PLI opportunity. Maintain BUY Q4 revenue/EBITDA were a tad lower than our estimates. Barring strong performance in ARV (+29% YoY), most markets reported sluggish growth. Despite sharp increase in R&amp;D; spends (7.6%, +150bps QoQ), EBITDA margin was largely in line with estimates at 21.2% (-30bps QoQ). Aurobindos progress on complex pipeline (2 biosimilars filing in FY22/FY23, filings of depot injectables in FY23) provides good growth visibility over the medium to long term.<div class="content-highlight">Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</div>

We tweak our estimates and revise TP to INR1,075/sh, based on 16x FY23e EPS and NPV of INR50 for the PLI opportunity. Maintain BUY Q4 revenue/EBITDA were a tad lower than our estimates. Barring strong performance in ARV (+29% YoY), most markets reported sluggish growth. Despite sharp increase in R&amp;D; spends (7.6%, +150bps QoQ), EBITDA margin was largely in line with estimates at 21.2% (-30bps QoQ). Aurobindos progress on complex pipeline (2 biosimilars filing in FY22/FY23, filings of depot injectables in FY23) provides good growth visibility over the medium to long term.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Aurobindo Pharma (4QFY21): Soft quarter, outlook remains strong. Maintain BUY

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Gland Pharma Ltd / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/gland-pharma-ltd" target="_blank" data-smartkarma-citation="entities:29723:1" rel="noopener">Gland Pharma (7172753Z IN)</a> aims to raise around US$900m in what would be one of India’s largest IPOs in 2020. The company was established in 1978 by P.V.N. Raju. KKR invested in the company in 2014 and <a href="https://www.smartkarma.com/entities/shanghai-fosun-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:8045:1" rel="noopener">Shanghai Fosun Pharmaceutical (Group) (2196 HK)</a> bought a 74% stake in the company in 2017. Gland Pharma was one of the fastest growing generic injectables-focused companies by revenue in the United States from 2014 to 2019. GP sells its products primarily via a B2B model in over 60 countries, including US, Europe, Canada, Australia, and India. It also operates a B2C model in India.GP’s revenue has grown at 28.78% CAGR over FY18-20 and was up another 29.4% in 1Q21. At the same time, PAT margins have increased from 19.2% in FY18 to 34.2% in 1Q21. Thus, PAT has grown at 55.15% CAGR and was up another 70.6% in 1Q21. However, the company hasn’t provided a whole lot of details about the revenue breakdown for its products. In addition, not all the pre-IPO shareholders will be locked-up post listing.

Gland Pharma (7172753Z IN) aims to raise around US$900m in what would be one of India’s largest IPOs in 2020. The company was established in 1978 by P.V.N. Raju. KKR invested in the company in 2014 and Shanghai Fosun Pharmaceutical (Group) (2196 HK) bought a 74% stake in the company in 2017. Gland Pharma was one of the fastest growing generic injectables-focused companies by revenue in the United States from 2014 to 2019. GP sells its products primarily via a B2B model in over 60 countries, including US, Europe, Canada, Australia, and India. It also operates a B2C model in India.GP’s revenue has grown at 28.78% CAGR over FY18-20 and was up another 29.4% in 1Q21. At the same time, PAT margins have increased from 19.2% in FY18 to 34.2% in 1Q21. Thus, PAT has grown at 55.15% CAGR and was up another 70.6% in 1Q21. However, the company hasn’t provided a whole lot of details about the revenue breakdown for its products. In addition, not all the pre-IPO shareholders will be locked-up post listing.

Gland Pharma IPO - High on Growth but Low on Details

Forensic Analyst, Trudence Capital Advisors

Nitin Mangal

Forensic Analyst

Thematic (Sector/Industry)

Corona Virus shadows are glooming all over the world, and these fears have just begun. As a major highlight of 2020, the virus has conquered the financial streets as well resulting in bloodbaths across all the major indices. However, one industry for which a major threat awaits to prolong is the Indian Pharmaceuticals, whose supply chain is likely going to shred into major disruptions.

Corona Virus shadows are glooming all over the world, and these fears have just begun. As a major highlight of 2020, the virus has conquered the financial streets as well resulting in bloodbaths across all the major indices. However, one industry for which a major threat awaits to prolong is the Indian Pharmaceuticals, whose supply chain is likely going to shred into major disruptions.

COVID-19 : A Viral Threat to Pharma Supply Chain

Founder

Kemp Dolliver, CFA

Cherrystone Hill Research

Sun Pharmaceutical Industries / Equity Bottom-Up

New information in the government's investigation into antitrust violations by generic drug companies continues to surface. An unredacted version of the Attorneys General complaint was published recently by a health care trade publication. The unredacted portions of the document paint an incriminating picture of the industry, increasing the pressure to settle. The timetable for the process remains open-ended, and manufacturers will be reluctant to raise prices absent documentable product shortages. Among the Indian companies, <a href="https://www.smartkarma.com/entities/98" target="_blank" data-smartkarma-citation="entities:98:1">Sun Pharmaceutical Indus (SUNP IN)</a>, <a href="https://www.smartkarma.com/entities/16406" target="_blank" data-smartkarma-citation="entities:16406:1">Dr. Reddy'S Laboratories (DRRD IN)</a>, and <a href="https://www.smartkarma.com/entities/19974" target="_blank" data-smartkarma-citation="entities:19974:1">Aurobindo Pharma (ARBP IN)</a> feature prominently in the court filings.

New information in the government's investigation into antitrust violations by generic drug companies continues to surface. An unredacted version of the Attorneys General complaint was published recently by a health care trade publication. The unredacted portions of the document paint an incriminating picture of the industry, increasing the pressure to settle. The timetable for the process remains open-ended, and manufacturers will be reluctant to raise prices absent documentable product shortages. Among the Indian companies, Sun Pharmaceutical Indus (SUNP IN), Dr. Reddy'S Laboratories (DRRD IN), and Aurobindo Pharma (ARBP IN) feature prominently in the court filings. 

India Generic Drugs: "Antitrust Unredacted"

India

Aurobindo Pharma Limited manufactures and markets oral and sterile antibiotics, antibacterials, anti-ulcerants and other generic basic drugs. Products include semi-synthetic penicillin drugs like ampicillin and amoxycillinas well as antibiotics, which include cloxacillin and dicloxacillin. The Company also manufactures formulations like astemizole, domeperidone and omeprazole.

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Aurobindo Pharma (ARBP IN)

AUROPHARMA: Expect Revenue and PAT CAGR of 9.6% and 13.9%

We expect revenue and PAT CAGR of 9.6% and 13.9% over the period FY20-FY23E and recommend 'BUY' with TP of Rs 1,100/share.

Axis Direct

Aurobindo Pharma (4QFY21): Soft quarter, outlook remains strong. Maintain BUY

We tweak our estimates and revise TP to INR1,075/sh, based on 16x FY23e EPS and NPV of INR50 for the PLI opportunity. Maintain BUY Q4 revenue...

HDFC Securities

Gland Pharma IPO - High on Growth but Low on Details

Gland Pharma aims to raise around US$900m in what would be one of India’s largest IPOs in 2020. Fosun Pharmaceutical bought a 74% stake in the...

Sumeet Singh

COVID-19 : A Viral Threat to Pharma Supply Chain

Corona Virus shadows are glooming all over the world, and these fears have just begun. As a major highlight of 2020, the virus has conquered the...

Nitin Mangal

India Generic Drugs: "Antitrust Unredacted"

New information in the government's investigation into antitrust violations by generic drug companies continues to surface. An unredacted version...

Kemp Dolliver, CFA

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