GlaxoSmithKline Pharmaceuticals - 4QFY2017 Result Update - Angel Broking

GlaxoSmithKline Pharmaceuticals (GSK) posted better than expected results on sales and OPM fronts for 4QFY2017. The revenues came in at Rs. 763cr v/s Rs. 690cr expected, registering a yoy growth of 10.9%. On the OPM front, the EBDITA margins came in at 15.2% (v/s 11.3% expected) as compared to 16.1% in 4QFY2016. The Adj. PAT for the quarter came in at Rs. 86.7cr v/s Rs. 95.4cr in 4QFY2016, a yoy dip of 9.2%. Given the valuations we maintain our Neutral.

Results better than expectations: The revenues came in at Rs. 763cr v/s Rs. 690cr expected, registering a yoy growth of 10.9%. On the OPM front, the EBDITA margins came in at 15.2% (v/s 11.3% expected) as compared to 16.1% in 4QFY2016. The expansion in margin was on the back of lower than expected employee and other expenses, which grew by 8.0% and 4.6% yoy respectively. The Adj. PAT during the quarter came in at Rs. 86.7cr v/s Rs. 95.4cr in 4QFY2016, a yoy dip of 9.2%.

Outlook and valuation: Company has a strong balance sheet with cash of ~Rs. 900cr, 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 12.2% to Rs. 3,685cr, while the EPS is expected to post a CAGR of 31.7% over FY2017–19E. We remain Neutral on the stock.

Shares of GLAXOSMITHKLINE PHARMACEUTICALS LTD. was last trading in BSE at Rs.2368.8 as compared to the previous close of Rs. 2399.6. The total number of shares traded during the day was 2313 in over 397 trades.

The stock hit an intraday high of Rs. 2415 and intraday low of 2360. The net turnover during the day was Rs. 5501771.

Source : Equity Bulls

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