AUROPHARMA - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 How I’m Thinking About This

You’re asking for a full-spectrum fundamental analysis of Aurobindo Pharma, with a clear numeric rating and actionable guidance. I’m weighing its financial strength, valuation metrics, business model, and technical signals to determine whether it’s a good long-term bet and where to enter if undervalued.

📊 Core Financials Breakdown

Profit Growth

PAT surged from ₹408 Cr to ₹559 Cr → +69.9% QoQ — strong rebound

EPS: ₹33.7 — solid earnings base

Return Metrics

ROCE: 10.8% — decent operational efficiency

ROE: 8.65% — moderate shareholder return

Debt & Cash Flow

Debt-to-equity: 0.23 — healthy leverage

Cash flows are stable, but not aggressively expanding

💰 Valuation Indicators

Metric Value Interpretation

P/E Ratio 33.4 Fairly valued vs industry PE

P/B Ratio ~3.22 Slight premium to book value

PEG Ratio 7.83 High — suggests overvaluation relative to earnings growth

Intrinsic Value ~₹1,050–₹1,100 Slightly above fair value

PEG ratio is inflated due to recent earnings spike, which may not be sustainable.

🏭 Business Model & Competitive Edge

Industry: Pharmaceuticals — defensive and globally scalable

Moat: Strong export presence, diversified therapeutic portfolio

Recent Trends: Regulatory clarity improving, cost optimization underway

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Volume Spike: Institutional interest returning — volume up 50% over 1-week average

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📉 Technical & Entry Zone

Current Price: ₹1,128

DMA 50/200: Trading above both — bullish crossover

MACD: +7.01 — bullish momentum

RSI: 65.1 — nearing overbought zone

📌 Suggested Entry Zone: ₹1,080–₹1,100

This range aligns with support levels and offers a safer entry before potential breakout above ₹1,200

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🕰️ Long-Term Holding Guidance

Hold if already invested, especially with improving fundamentals

Buy on dips near ₹1,100 if bullish on pharma sector

2026 Target Price: ₹1,250–₹1,317 based on analyst forecasts

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⭐ Fundamental Rating

4.1

Strong recovery in earnings, solid fundamentals, and improving technical setup — but valuation is slightly stretched. Let me know if you’d like a peer comparison with Sun Pharma or Cipla.

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