Religare Research has recommended 'Buy' on Aurobindo Pharma (ARBP) with target price of Rs 1,585 as against current market price of Rs 1,374.20 in its report.

Commenting on the investment rationale, the stock broker said, "ARBP continued to post strong operational numbers for yet another quarter, with Q4 EBITDA margins at 20.7% beating estimates despite integration of the lower-margin Natrol business. We think this underlines the inherent strength in its base business, which should report a 21% EPS CAGR over FY15-FY17E on strong growth in the US (injectables, controlled substances) and lower losses in the acquired Actavis' portfolio.

We value ARBP at 20x FY17E EPS to arrive at a Mar'16 TP of Rs 1,585. Our exit multiple is at a 10-20% discount to large-cap peers on account of a higher proportion of API sales. Buy with a Mar'16 TP of Rs 1,585."

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.