Motilal Oswal's research report on GlaxoSmithKline Pharma
“Shingrix” launch soon; WPI to mitigate the impact of price cut under NLEM We attended the analyst meet of Glaxosmithkline Pharma (GLXO) to understand the company’s business outlook over the next two to three years. GLXO plans to launch the ‘Shingrix’ vaccine in the domestic formulation market in the near term. The adverse impact of inclusion of certain brands under the national list of essential medicines (NLEM) is expected to be mitigated by higher volume offtake, increased reach, Shingrix launch, and cost optimization measures.
We cut our EPS estimate by 3% for FY24/FY25 to factor in a) lower prices of certain brands (Ceftum/T-Bact) and b) gradual improvement in inflation-linked overall prices. We value GLXO at 33x 12M forward earnings to arrive at a price target of INR1,300. We reiterate our Neutral stance on the stock.
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