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Pharma Stocks To Buy, Soaring Near Term Returns: Motilal Oswal Advises

Pharma stocks gained much returns due to the pandemic over the past two years. Brokerage firm Motilal Oswal is optimistic about these two pharma stocks although the equity markets are quite volatile now.
Kuntala Sarkar
Sun Pharma
Sun Pharma's current market price is Rs. 888, Motilal Oswal estimated a target price of Rs. 1040, for 17% return. Its market capitalization (large cap) is Rs. 207,566 crore.
Financial performance
Its sales rose 11% YoY to Rs. 93.9b in 4QFY22, and adjusted PAT has grew 8.6% YoY to Rs. 15.8b. Revenue/EBITDA grew 16%/23% to Rs. 384b/Rs. 99b in FY22.
Motilal Oswal thinks
We remain positive on the back of a strong outperformance in the branded Generics segments of DF/RoW/EMs, and scale-up of the Specialty portfolio.
Created by potrace 1.15, written by Peter Selinger 2001-2017
Created by potrace 1.15, written by Peter Selinger 2001-2017
Aurobindo Pharma (ARBP)
Aurobindo's current market price is Rs. 531, Motilal Oswal estimated a target price of Rs. 640, for 21% return. Its market capitalization (large cap) is Rs. 30,961 crore.
Financial performance
Margin was stable QoQ, but down YoY. Sales fell 3.2% YoY to Rs. 58.1b, formulation sales fell 6% YoY to Rs. 49b, and EBITDA fell 24% YoY to Rs. 9.7b.
Motilal Oswal thinks
The ARV business is expected to sustain normalized in 4QFY22 quarterly sales. ARBP building its niche product pipeline; robust pace of approvals in US Generics noticed.