GSK Consumer - Qualitatively weak nos., Retain Accumulate - Emkay

Reco: ACCUMULATE
CMP: Rs 2675
Target Price: Rs 3000

- Sales disappoint led by exports decline of 12%. However APAT, beats expectation, grew 29.3% yoy; primarily driven by gross margin expansion of 360bps and other income (+84%).

- Domestic sales grew by 15% (despite flat CSD sales) led by 7% volume and 8% price hike. Boost outperformed due to relaunch. Business auxiliary income grew 40% yoy.

- Biscuits portfolio grows 27% yoy, Foodles constrained by tepid response and Horlicks Oats occupies No 3 position and 11.3% market share in South India.

- Plans to take ~5% annualized price hike in key products to maintain profitability, indicating the company's confidence in its portfolio's price in-elasticity. Maintain 'ACCUMULATE'.

Source : Equity Bulls

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