Shares of GlaxoSmithKline Pharmaceuticals (GSK Pharma) extended their rally for the second consecutive session on Tuesday (February 18), gaining 29% over two days. The stock had hit a 20% upper circuit at ₹2,421.30 during intra-day trading on February 17.
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On February 18, GSK Pharma surged over 17% intraday following strong December quarter results. Despite profit booking, the stock remained firm, closing at ₹2,608 on the BSE, up 11.82%, after touching an intra-day high of ₹2,744.95.
Over the past year, the stock climbed 69% in four months from its 52-week low of ₹1,825.05 on April 15, 2024, to a record high of ₹3,087.95 on August 22, 2024. It currently trades about 19% below this peak.
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GSK Pharma delivered a better-than-expected performance in Q3, largely driven by robust volume growth in the general medicine segment and a continued scale-up in vaccine offtake. Notably, the company strengthened its market share in top brands like Augmentin, Ceftum and T-bact. It also expanded its presence with its respiratory products.
Brokerage firms, including Motilal Oswal and ICICI Securities, continue to stay positive on the stock. Motilal has raised its earnings estimates by 2%, 5%, and 7% for FY25, FY26, and FY27, respectively, to factor in differentiated launches in cancer therapy, scale-up of the vaccine business and enhanced efforts to boost vaccine prospects.
The brokerage said the current valuation captures the earnings upside. Motilal has maintained a ‘neutral’ rating on the stock, with a price target of ₹2,170 per share. ICICI Securities raised its estimates on GSK Pharma for the company’s FY25-26E earnings per share, to approximately 5-6%. This was mainly due to a better margin outlook.
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The brokerage upgraded its rating of the shares to ‘add’ with a lower target price of ₹2,250, based on 38x FY26 estimates of earnings per share.
Shares of GlaxoSmithKline Pharmaceuticals Ltd ended at ₹2,608, up by ₹275.75, or 11.82%, on the BSE.
