Equirus has downgraded Astec Life from “Long” to “Short” and sharply cut its target price to ₹970 from the previous ₹1,500. This marks a potential downside of nearly 20% from the current market price of ₹1,208.90.
The downgrade follows the departure of Astec’s CEO, which Equirus describes as occurring at a “critical turning point” for the company. The CEO played a significant role in driving Astec’s Contract Development and Manufacturing Organization (CDMO) business, and his exit could severely impact growth prospects, according to the brokerage.
Adding to the concerns, Astec’s enterprise business remains stagnant, and there is uncertainty surrounding the future of the CDMO segment, which had been a focal point for growth under the outgoing leadership. Equirus also highlighted that the CEO’s contribution was pivotal in advancing the CDMO business, and his departure leaves a vacuum that could slow Astec’s expansion efforts.
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