Shares of GlaxoSmithKline Pharmaceuticals (GSK Pharma) fell over 1 percent on Wednesday after brokerage firm Morgan Stanley maintained an ‘underweight’ rating on the stock owing to the company's rich valuation and relatively lower growth profile.

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Morgan Stanley also cut its target price from the earlier Rs 1464.40 to Rs 1,416 per share. At 09:48 shares of the pharma company were trading at Rs 1448, a 1.05 percent decline from the previous close on the BSE.

Morgan Stanley noted that GSK Pharma is a key player in the domestic pharmaceutical market with its increasing contribution and innovative products.

The vaccine business contributes 22 percent of sales for GSK Pharma, Morgan Staley estimated that this should improve as the pandemic subsides.

In a regulatory filing last month the company mentioned that its consolidated net profit for the April-June quarter increased by 8 percent and stood at Rs 116 crore in comparison to Rs 107 crore in the corresponding period last year.

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Revenue from operations rose to Rs 745 crore as against Rs 718 crore in the year-ago period.

"Our results reflect good momentum across general medicines and vaccines during the quarter. We have delivered strong underlying growth with market share gains across focus brands," GlaxoSmithKline Pharmaceuticals MD Sridhar Venkatesh noted.

GlaxoSmithKline Pharmaceuticals is a subsidiary of GlaxoSmithKline plc, one of the world's leading research-based pharmaceutical and healthcare companies.

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First Published:Aug 24, 2022 11:37 AM IST