Research house and brokerage Motilal Oswal has suggested BUY Call for pharmaceutical major Aurobindo Pharma with a target price of Rs 985. Aurobindo Pharma is currently trading at Rs 785 and the BUY Call presents decent returns in medium term.

During the pandemic, majority of the pharmaceutical and technology stocks have witnessed sustained buying. The investor interest in these counters has helped many companies to touch their 52-week or even lifetime highs. Market players are confident that pharmaceutical companies will outperform overall markets.

As per Motilal Oswal recommendation, the FY22E EPS estimate has been reduced by 2.5% to INR 62.2 to factor in the Natrol divestment and revised the price target to INR 985, based on 16x 12M forward earnings. The earlier price target suggested by Motilal Oswal was INR 1,015 for the stock.

Aurobindo Pharma reported Rs 5835 crore in sales for quarter ending June 2020, registering an increase by 9 percent compared to the same quarter last year.