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This is an entirely free service. No payments are to be made.Glaxosmithkline (GSK), the parent company of GSK Pharma made an open offer to shareholders to increase its stake in the latter. The price offered to the shareholders is Rs 3,100 per share. The parent company intends to buy 22,609,774 shares of GSK India, which is 24.33% of the total outstanding shares. This will increase the parent company's holding from the current 50.7% to 75%.
Threats and opportunities for GSK Pharma:
For the upcoming period, while the company's anti-infectives, and vitamins segments are expected to continue to remain under pressure, large part of growth will come from dermatology and other segments like respiratory and vaccines.
We believe that GSK Pharma has challenges on various fronts, and hence growth is expected to remain muted atleast for the next 2-3 years. Having said that, even if we assume a top line growth of around 15% with EBITDA margins of around 30% over the next 2 years which we believe is quite optimistic, we are of the view that at the current price, there is still not much upside left in the stock price of GSK Pharma.
Hence in our view, investors should take the advantage of the open offer and offload their holdings.
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