Glaxosmithkline Consumer - Nirmal Bang

- Glaxo reported Q2 result which was broadly in line with market expectations.

- Glaxo reported 16.9% increase in Net Sales on YoY basis at Rs 852.9 crs in Q2CY13, and down by 9.3% QoQ.

- EBITDA was up by 12% YoY to Rs. 156 crs and down by 24.4% QoQ. Company reported Operating margins at 17.5% in Q2CY13 as compared to 18.4% in Q2CY12 and 21.2% in Q1CY13. EBITDA margins got negatively impacted due to the employee cost and Other expenses as a % of sales.

- Gross margin improved by 200bps YoY to 65% in Q2CY14 and 290bps QoQ.

- Company reported PAT at Rs 120 crs in Q2CY13 (up by 12.5% on YoY and down by 23.3% on QoQ basis). The PAT margins were 14.1% in Q2CY13, 14.6% in Q2CY12 and 16.6% in Q1CY13. Jump in depreciation cost and tax rate impacted the profitability of the company however jump in Other income and decline in interest cost provided some respite in the PAT contraction.

- The stock is currently trading at 41.2x on trailing basis.

Source : Equity Bulls

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