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GlaxoSmithKline Pharma - 2QFY2016 Result Update - Angel Broking
Posted On : 2015-11-03 21:30:08( TIMEZONE : IST )
For 2QFY2016, Glaxo Smithkline Pharma (GSK Pharma) reported a disappointing set of numbers, due to lower- than-expected sales. Sales came in at Rs. 692cr (V/s Rs. 720cr expected), a dip of 6.4% yoy, which was due to supply constraints. On the operating front, the company's gross margins for the quarter came in at 56.4% V/s 53.5% in 2QFY2015. In spite of the rise in gross margins, the OPM came in lower at 17.4% V/s an expected 20.2% and V/s 21.3% in 2QFY2015, mainly owing to lower sales during the quarter. Thus, the reported net profit came in at Rs. 96cr V/s Rs. 129cr in 2QFY2015. However, the Adj. net profit came in at Rs. 101cr V/s Rs. 129cr in 2QFY2015, a yoy dip of 21.4%. We remain Neutral on the stock.
Results below our expectations: For 2QFY2016, GSK Pharma reported a disappointing set of numbers, due to lower- than-expected sales. Sales came in at Rs. 692cr (V/s Rs. 720cr expected), a dip of 6.4% yoy, which was due to supply constraints. On the operating front, the company's gross margins for the quarter came in at 56.4% V/s 53.5% in 2QFY2015. In spite of the rise in gross margins, the OPM came in lower at 17.4% V/s an expected 20.2% and V/s 21.3% in 2QFY2015, mainly owing to lower sales during the quarter. Thus, the reported net profit came in at Rs. 96cr V/s Rs. 129cr in 2QFY2015. However, the Adj. net profit came in at Rs. 101cr V/s Rs. 129cr in 2QFY2015, a yoy dip of 21.4%.
Outlook and valuation: The company has a strong balance sheet with cash of ~Rs. 2,000cr, which could be used for future acquisitions or higher dividend payouts. On the operational front, we expect the company's net sales to post a CAGR of 9.8% to Rs. 3,158cr and EPS to register a mere CAGR of 6.6% to Rs. 68.3 over FY2015-17E. We remain Neutral on the stock.
Shares of GLAXOSMITHKLINE PHARMACEUTICALS LTD. was last trading in BSE at Rs.3228.75 as compared to the previous close of Rs. 3225.3. The total number of shares traded during the day was 993 in over 275 trades.
The stock hit an intraday high of Rs. 3265 and intraday low of 3219.95. The net turnover during the day was Rs. 3215460.
