Buy Aurobindo Pharma for a target of Rs 1167: KRChoksey Research
February 8, 2010 by admin
Filed under Brokerage Recommendations
KRChoksey Research in its February 05, 2010 research report has recommended a buy rating on the stock Aurobindo Pharmaceuticals for a target of Rs 1167.
KRChoksey Research further said that, we have positive view on the company mainly due to attractive valuations. We expect the sales to grow at a CAGR growth of 25% FY09-11E, backed by robust growth from formulations, new product launches, licensing deals & supply arrangements with MNC pharma companies and existing products gaining critical mass. The strong pipeline of products for approval as well the diversified product mix will act as the future growth driver of the company. We feel the stock has the potential to trade at higher levels and looking at the past trend we have taken an earnings multiple of 11x FY11E EPS of Rs 104.4 to arrive at the target price of Rs 1,167.
We recommend a “BUY” on the stock with 12-month target price of Rs 1,167, which represents a potential upside of 34%. At the CMP of Rs 871, the company’s stock is trading at 12.2x FY10E EPS of Rs 71.7 and 8.3x FY11E EPS of Rs 104.4.
Source: Moneycontrol.
