Aurobindo Pharma Share Price Drops 4% Amid Zentiva Buyout Talks

Market Performance

Aurobindo Pharma’s share price slipped over 4% to ₹1,039 on August 20, 2025. The fall came after reports suggested that the company is in advanced talks to acquire Prague-based generic drugmaker Zentiva for $5-5.5 billion (₹43,500-47,900 crore).

So far in 2025, the stock has declined by 21%, in contrast to the Nifty 50 index, which posted a modest 2% rise during the same period.

Main News

If the Zentiva acquisition goes through, it will mark the largest-ever takeover by an Indian pharmaceutical company.

• It would surpass the 2014 Daiichi Sankyo-Ranbaxy deal worth $3.2 billion.
• It would also be bigger than Biocon Biologics’ $3.3 billion Viatris deal.

The potential acquisition is seen as a strategic move to expand Aurobindo’s presence in Eastern Europe, particularly in Czech Republic, Romania, and Slovakia. These regions are projected to offer strong growth opportunities for biosimilars, especially with multiple major drug patents nearing expiry.

Company Financials

Revenue

• Q1 FY26 Revenue: ₹7,868 crore
• Q1 FY25 Revenue: ₹7,567 crore
• Growth: Up 4% year-on-year

Net Profit

• Q1 FY26 Net Profit: ₹824 crore
• Q1 FY25 Net Profit: ₹918 crore
• Change: Down 10.2% year-on-year

EBITDA

• Q1 FY26 EBITDA: ₹1,603 crore
• Q1 FY25 EBITDA: ₹1,619.6 crore
• EBITDA Margin: Declined to 20.4% from 21.4%

Regional Business Performance

• US Formulations Revenue: ₹3,488 crore (down 1.9% YoY)
  • Decline attributed to destocking and seasonal headwinds.
• European Formulations Revenue: ₹2,338 crore (up 18% YoY)
  • Strong growth driven by higher demand across key European markets.

Summary

Aurobindo Pharma share price witnessed a sharp fall after reports of a potential Zentiva acquisition worth up to $5.5 billion. While the deal could significantly enhance the company’s European presence, the short-term market reaction remained negative.

On the financial side, Aurobindo reported steady revenue growth in Q1 FY26, though net profit and margins slipped. The European business continued to post double-digit growth, while the US market faced pressure.