Aurobindo Pharma Shares Decline Following US FDA Inspection

Shares of Aurobindo Pharma Ltd. fell by over 9% on Tuesday, following announcement of the completion of a US FDA pre-approval inspection at Eugia Steriles Pvt., a 100% step-down subsidiary located in Parawada Mandal, Andhra Pradesh. The inspection, which took place from Feb. 10 to Feb. 18, concluded with five observations, which the company has committed to addressing within the stipulated time frame.

In a regulatory filing Aurobindo Pharma stated, “The observations are procedural in nature and will be responded to within the stipulated time. We will keep the stock exchanges informed if there is any further information relating to the above in the future.”

The Hyderabad-based bulk and generic drugmaker reported a profit of Rs 846 crore for the quarter ending Dec. 31, 2024, as per an exchange filing on Thursday. This figure falls short of the Rs 893-crore consensus estimate by analysts tracked by Bloomberg.

Shares of Aurobindo Pharma fell as much as 9.51% to Rs 1,102 apiece, before paring losses to trade 3.64% lower at Rs 1,121 apiece, as of 09:48 a.m. This compares to a 0.11% advance in the NSE Nifty 50.

The stock has risen 5.87% in the last 12 months. Total traded volume so far in the day stood at 1.36 times its 30-day average. The relative strength index was at 38.

Out of 29 analysts tracking the company, 22 maintain a 'buy' rating, three recommend a 'hold' and four suggest 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies an upside of 35.8%.