Aurobindo Pharma Overview
Aurobindo Pharma is an Indian Pharma company. It has grown to become a Multinational company with presence in around 26 countries of the World. It has wide range of operations in Pharma space. As per Aurobindo pharma official website the company deals with
- API – Active Pharmaceutical Ingredients to be used to drugs
- Formulations – The drugs itself
- Custom Synthesis – Contract manufacturing of drugs on contracts from other companies
- ARV’s and HIV’s – HIV treatment. A growing market area
- Peptides – Used in Drug development
- Nutraceutical – Food Supplements. A fast growing market
- Bio Catalysts used in Pharma and Chemical business.
It is one of the top ten Pharma companies in India in terms of consolidated revenue. Approx 70% of the revenue comes from export. The company has been doing good in past years which is well reflected in the share price of the company as you will see in below section.
Aurobindo Pharma Share Performance
As mentioned in previous articles Share Price performance is the easiest measure of how well the company has done in past. Note the frenzy movement lasts for one year or two year at max. So the best companies are those who perform year after year at a decent pace.
If you see closely the share price had steep jump after the year 2013. In next two years the prices have increased multi fold. After this kind of jump you will see some resting period. Due to FDA issues and Generic related push from Government after 2016 the stock prices have almost flat or with slight decline.
Entry point and Exit point is very important for any stock. So if you enter at wrong place then you will have to wait for profit or you may end up selling at loss. The prices will consolidate for sometime before next big move. This is the time for consolidation after frenzy move between 2013 and 2016. Remember the flat period before 2013. The stock was trading in range and was slow mover that time.
Aurobindo Pharma My Opinion
Pharma sector as a whole has been performing well for quite sometime. Recent couple of years were bad for Pharma due to increased scrutiny by US FDA and push for Generic by government.
These two factors have hunted Pharma sector. Many companies with US FDA issues were hurt bad and are taking time to move forward. Auro Pharma is also impacted by FDA issues which is being reflected in share price.
The INR depreciation is good for Pharma industry as it is for IT industry. Pharma still makes most money from Exports due to low cost factor. This may continue in future as well. The number of Pharma companies in India are increasing.
Aurobindo Pharma is also one Pharma company which is present in portfolio of Rakesh Jhunjhunwala. But there are many other top investors portfolios do not have any Pharma company like Dolly Khanna.
Conclusion
In case you are interested to invest in Pharma sector then you can add this stock to your stock watch list. There are many good companies in Pharma sector. You can compare them to find the one which best suits your needs. I will be writing post on Pharma companies comparison later.
Aurobindo Pharma has performed well for investors in past and may continue to do the same in future but you should really time your entry as well. This stock may be in consolidation phase looking at the recent FDA issues and great show in past.