Near-term growth issues and cost pressure could impact Aurobindo Pharma

While valuations are now attractive, product approvals and progress on the injectable guidance are among key long-term term triggers

Pegged back by a weak showing in the US and EU markets and cost pressures, Aurobindo Pharma delivered a weaker-than-expected performance in the March quarter (Q4). The muted performance and near-term margin outlook led to a downward revision of earnings estimates by up to 15 per cent.

The stock is down 4 per cent from the high touched on Wednesday, and is underperforming the broader market. Its trajectory will depend on the pace of approvals and uptick in the base business.

The company reported a 3.3 per cent year-on-year (YoY) fall in overall sales, largely on account of a 4.5 per cent