Aurobindo Pharma stock in focus as board to consider share buyback on Thursday, July 18

Share buyback: Aurobindo Pharma Ltd is in focus on Monday morning after the drug maker informed stock exchanges that its board of directors would meet on Thursday, July 18, to consider a proposal for share buyback of the fully paid-up equity shares of the company. The announcement came even as the scrip has climbed 80 per cent in the last one year.

Aurobindo Pharma said the meeting will be held on Thursday, July 18, 2024 to consider, inter alia, a proposal for buyback of the fully paid-up equity shares of the company and the matters necessary and incidental thereto, in accordance with the applicable provisions under the Companies Act, 2013, as amended (including the rules and regulations framed thereunder), the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, as amended, and other applicable laws.

"Further, pursuant to our letter dated June 26, 2024, the trading window for dealing in securities of the Company was closed for all its designated persons, connected persons and their immediate relatives with effect from July 01, 2024, and shall remain closed until forty-eight hours after the declaration of the unaudited financial results of the company for the quarter ended June 30, 2024. The trading window shall be deemed to be closed in respect of the aforementioned buyback proposal as well, in accordance with applicable laws," it said. 

MOFSL expects Aurobindo Pharma to report 63.6 per cent year-on-year rise in net profit at Rs 970.40 crore for the June quarter on 11.8 per cent YoY rise in sales at Rs 7,659.80 crore. It expects US sales for Aurobindo Pharma to grow 12 per cent YoY at $451 million, led by key launches, offset by temporary shutdown of Eugia’s unit-3. It expects EU sales growth of 7.5 per cent YoY to Rs 1,970 crore on expanding into newer markets and differentiated product offering. Progress on optimising the yield of Pen-g plant, outlook on reducing the operational cost and filing/approval status of biosimilar products in key markets will be keenly watched going ahead, it said.

"The company’s US business to grow to $452 million (up $20 million QoQ, as the 4QFY24 base was hit due to temporary plant shutdown). We expect better growth  in the API segment with the commencement of the PenG plant. Margins are likely to range around 21.3 per cent, a QoQ decline of 100 bps, as PenG-related operational  costs hit the base," it said.