The share price of Aurobindo Pharma declined over 3 percent in early trade on Tuesday after the company announced its March quarter earnings.

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The pharma major reported a 7.2 percent fall in consolidated net profit for the fourth quarter of fiscal 2021 at Rs 801.6 crore. The company’s net profit in the year-ago period was Rs 864 crore.

The revenue during Q4FY21 decreased 2.5 percent to Rs 6,001 crore from Rs 6,158 crore, YoY.

Read here:

Aurobindo Pharma Q4 net profit at Rs 801.18 cr

Here’s what brokerages have to say about the company’s stock and March quarter earnings:

CLSA

Complex product pipeline development should increase medium-term R&D spending but will boost long-term profitability, CLSA said.

"A strong commodity generics portfolio and its multiple R&D efforts underway to increase the contribution of high-entry-barrier products augur well for long-term profitability," said CLSA. However, it said after an 18 percent rally over the past three months, most key positives are priced-in.

CLSA downgraded the rating on the stock to Outperform from Buy as it sees limited upside following the recent rally. The brokerage lowered its FY23 EPS 2 percent and raised the target price to Rs 1,040 per share from Rs 1,000 earlier.

JPMorgan

The brokerage has maintained an Overweight rating with a target at Rs 1,100 per share.

"It was another good quarter despite higher R&D. The core business visibility and injectable optionality are going to support the stock. The merging unit 16 with Eugia is a step closer to exploring value-unlocking options," JPMorgan said.

Credit Suisse

Credit Suisse likes the stock on account of large injectable business and improving quality of filings. Also, China opportunity and bulk drugs PLI scheme is a positive, it said.

It maintained an Outperform rating with a target price of Rs 1,080 per share.

Motilal Oswal

Motilal Oswal has a Buy call on the stock with a target price of Rs 1,150 per share.

"We tweak our FY22E/FY23E EPS estimate by -3%/-2%, factoring in the impact of the lockdown on the offtake of medicines in Europe/growth markets, and increased spends towards the development of complex products," Motilal Oswal said.

At 11:52 am, the stock was trading 3.36 percent lower at Rs 964.25 apiece on the BSE.

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