yMcy56:
ZENITH Vs. GTCO
GTB may eventually take it's place back with time....

Not disputing the fact that Zenith is way ahead in terms of dividend yield, PAT and all that.........but GTB seems to have anointing for leadership.

I hope those bashing the price will do quick and allow the stock rest and face front.

Let's see how Mr. Time, Mr. Market and Mrs. Result takes care of this situation.

Given Zee and GT, at present price, I'll go for GTCO. Don't mind me, I no be expert and I no know book. Just thinking out loud......and maybe because I be jijoist, we like things moving fast and pretty well.
Las las, both are good to have in one's portfolio.

goody234:
I have some of their shares apparently they are delisting what does that mean for us

Wapgod:

N284.9 or N285 is the average of N290 and N280.
I think the two separate sell mandates were joined and executed as one at the average price of the two separate mandates.

Pamelayoung:
Guru's in the house please I need assistance with

1. Understanding fundamental and technical analysis of stock trading

There are a lot of books to read on this subject matter. We can only summarized the difference between the two here and cite one or two practical examples but they are much more detail in on real sense. I will advise u press a goggle search engine and see plenty of write up on these two areas

2. Stock recommendations for short term

As per this, it is only luck and insider information that can give your return on short term basis. There is no stock u cannot make short term profit from but like I said, it is all about luck. If I can define what u mean by short I will possibly up to one year, I will advise Transcorp, Fidelity, Academy press, UPDC, but all is still about luck

3. Take on vitaform at the current price of 22.0 considering dividend pay-out

customstreet:
Is there any possibility of merger or acquisition among the following companies in the foreseeable future?

1. Unity Bank and Jaiz Bank
2. UNILEVER and GSK
3. Presco Oil and Okitipupa Oil
4. DangoteCem and LafargeWAPCO
5. Flour mill and NNFM

I foresee one to happen in the near future

onegentleguy:


Well done @ Awo

Sorry am just seeing this your wonderful post. It's indeed critically inquisitive and I like it.
I also like the fact that you engaged in such a mature and constructive manner, which is quite commendable.
If only some folks can learn from you and do the same, NSEMPA and the world at large will be a better place.

Now to the crux of the matter...
Apparently, you are looking at that line item as a negative, but have you tried to "scrutinize" what degree of impact it could actually have on GSK?
The items in a financial print are the result of actions of man. And since No man is perfect, No financial print will be.
There will always be positives and negatives... the KEY is to weigh both lines in proper balance and see where VALUE or the lack of it, exist.
This is what I mean when I say; Look out for the good in a bad report and the bad in a good one.

Now to GSK' financial print.
Will try to touch on all your concerns. 1st, let's "scrutinize" their payables...

The 1st thing I do when I see a high trade & other payable (T&OP) line is to question the coys debt management ability and it's liquidity/working capital stand. Both lines are intertwined.
The argument is that if the company's T&OP is very high, then it's possible that it has so high a debt burden and so low a cashflow/liquidity posture to cover purchases for the day to day run of business.
T&OP are mainly for inventory related matters hence are often current in nature. So we can use D/CA ratio and Current ratio.
Whatever we decide to do though, GSK has practically zero debt so D/CA= 0, while it's current ratio pegs at approx 1.44x.
By implication therefore, the coys high T&OP is not the result of debt concern neither is it a liquidity/working capital challenge.
Note that we can not at this point use the quick ratio as that would be dealing with an indicator that discounts our line of interest (inventory) which primarily concerns payables.

The next thing to do is to investigate and see if it's a trend within the sector that the coy operates.
GSK operates in the pharmaceutical sector where high leverage/debt (seen as a necessary stead to maintain liquidity) is the order of the day. These debts can come in various forms under a coys liability line. While other coys like FIDSON borrows heavily and gradually fund its T&OP line, GSK is doing the exact opposite (not borrowing, not funding)
Why? Observe GSK' ∆T&OP in near 2 yrs (7 quarters) and compare it to the coys days in inventory (365/IP) and ∆T&OR (trade receivables) position. The later 2 has toped up at a bit more of a faster pace than the former.
Now the only logical explanation is that GSK must have negotiated a payment term with its suppliers, wherein the zero CoF from lower T&OP TURNOVER (payables are non-interest bearing) is seen as a more favorable option than the CoF from debt. ...and that supplier will likely be a related party/subsidiary, otherwise the chances would be slim.
And yes indeed, GSK' major suppliers are related parties. (see the NTS... line 19 and by extension 22)
Notice how 4 of its sister companies constitute near 85% of GSK' T&OP line as at Q3. (over 12.3B)
Infact, effective trade payable is even less than the bal of 15%.
Again, observe the corresponding sharp drop on its input line with related parties in 2021. T&OR (receivables in view) from related parties dropped by over 2,383% to just approx 9.4M in 9 months.
Again suggesting that there must have been a negotiated payment term in place.

Another very important question is why a coy (in this case GSK) would have so much cash and yet, so little utilization. ...the reason for the slow growth in revenue and profitability/earnings margin.
Despite this though, AsQ is not detoriating. Why?
Lets dig in a bit more...

If you look at the trend in ∆ inventory and WC and the coys CFP in the last 2 yrs, you will observe an intent to want to improve margins using more of cash than asset.
Again, a logical explanation will be that GSK might be looking to recreate it's business model... and quite possibly, conserve and build capital to expand on other value accretive business lines.
The company's recent move to restructure it's internal operating model (supply chain in view) and appoint FIDSON as a local contract manufacturing partner may be part of it.
Interestingly, the said deal also started out in Q3, 2021.
I know that one of the KEY benefit that the part in bold will bring to GSK is increased Net Fx earnings capacity. ...which is key for coys operating in this space. Another advantage is that it will improve the company's value chain. (the coy will tap from the huge prospect in the vaccine mkt)
Then again, it will also shove down on input cost. All of which would help improve future margins.
I would've been worried if GSK was mismanaging it's cash stand even with the low margins. ...but this is clearly not the case.
A dig in the SCF and BS shows that the company has been very prudent at managing its cash. ...with an appreciable CF, healthy CGPR/CCC and extremely low CRM (cash burn rate in view) despite zero EFIR.
Infact the coy makes good money from its cash.
...with investment income and NGoOFA growing by approx 40.4% and a whooping 3,258.7% YoY in Q3 respectively.
Which explains why AsQ and AsY has remained relatively strong despite the low earnings margin. (NPM and EM in view)

There's more to say but let me stop here... to avoid a very long epistle.

Bottom line: That high T&OP must be due to a favourable payment/credit term.
I also think that the move is STRATEGIC.
GSK might be up to something. What it is... I do not know.
But I do know that if I discount all worries (including that of T&OP), assume zero growth in Q4 and factor in a very conservative risk premium, GSK' FVE would peg @ N20.81.
...so yes, EV is actually NEGATIVE and VALUE proposition is indeed immense!

I will keep buying GSK. But like the company, I also intend to be STRATEGIC in my buying spree. (trade/investment setup in view)

I hope I did enough justice addressing your concerns.
Selah

onegentleguy:


https://www.gsk.com/en-gb/media/press-releases/update-gsk-consumer-healthcare/#

OBAGADAFFI:


Unity Bank and Jaiz Bank, that's possible

Presco Oil and Okitipupa Oil, also possible

NNFM is a subsidiary of FlourMills

GSK and Unilever, they are not in the same industry

DANCEM and WAPCO, not sure it happen

onegentleguy:


On the part in bold, they actually do have something in common.

UNILEVER HPC business segment relates quite well with GSK consumer health care line of business.
Here's an interesting perspective...

Look at UNILEVER Nig' last spate of financial print and you'll notice that the groups HPC (home & personal care) business segment has been contributed a bit more to their topline than the food segment.
The 1st 9M of 2021 saw the former segment grow at a faster pace (print @ above 3x) the latter.
...Q3 highlights a slight deviation in growth trajectory despite price and vol growth in key product (like knorr cube, close-up etc) accross both business segment.
Little wonder they want that deal with GSK.
...they need it more!

Time to keep an eye on UNILEVER.
The mid to long term horizon should pay more than the short to mid term if you know what I mean.

At current mkt peg UNILEVER retains our HOLD rating. (my FVE presently pegs @ N15.9 attaching a high RP and raking-off surrounding worries)

As for GLAXOSMITHKLINE NIG, we have stopped talking about GSK.

It is well.

OBAGADAFFI:


Unilever is consumer goods, while GSK is Health/Pharmaceuticals.

GSK has been selling off her, consumer products (Lucozade and co) the focus on health/pharma.

There is so much money in pharmaceuticals at the moment.


Except GSK Int, sell off it Nigerian arm to Unilever, I don't see any merger happening.

onegentleguy:


UNILEVER has 2 core business lines;
HPC... Home and personal care business segment and
FBS... Food business segment which houses the core of the coys consumer products.

GSK operates on 2 core business lines;
Consumer health care business segment and
the Health/pharmaceutical arm of business.

And you really do not see any relationship btw GSK' consumer health care business segment and UNILEVER' HPC line... or how both segment can sync?

It means you still didn't quite follow the post.
You probably misrepresented matters.
Try reading btw the lines... then relate things to my previous analysis on GSK.

Note that am not saying that a merger, acquisition or buy-out will play out. ...I honestly know nothing about that pls.

Regards

yMcy56:

Oga Labalaba, you dey vex o
See the battalion you copied. Lol.
Igi Pawpaw o ni wo pawa o

onegentleguy:


UNILEVER has 2 core business lines;
HPC... Home and personal care business segment and
FBS... Food business segment which houses the core of the coys consumer products.

GSK operates on 2 core business lines;
Consumer health care business segment and
the Health/pharmaceutical arm of business.

And you really do not see any relationship btw GSK' consumer health care business segment and UNILEVER' HPC line... or how both segment can sync?

It means you still didn't quite follow the post.
You probably misrepresented matters.
Try reading btw the lines... then relate things to my previous analysis on GSK.

Note that am not saying that a merger, acquisition or buy-out will play out. ...I honestly know nothing about that pls.

Regards

ggoldmine:
You're right. Unilever is Close-up, GSK is MaCleans
But I think Macleans is extinct.

ggoldmine:
You're right. Unilever is Close-up, GSK is MaCleans
But I think Macleans is extinct.

sonofElElyon:


The man is not labalaba (butterfly)..

Nigerialabalaba:

As I dey look am so, Kabiyesi Gadaffi dey make sense o becos GSK don sell dia consumer goods section and share d money sef. Also, d 2 industries dey under different regulators (Gsk na pcn and NAFDAC and Unilever na only nafdac), e go easy for Unilever to relate/merge/buy Cadbury dan to buy GSK.

GSK' consumer health care business segment and UNILEVER' Households & Personal Care line no sync like dat o becos of regulation and production lines. Na only on paper e be like say dem sync. Wen GSK try am before, dey suffer wella so commot dia to face only pharmaceutical.

On paper you go tink say dem relate and sync until you enter u go con see wetin GSK mean wen dem talk say e fit be like panadol but no b panadol

Las las, if I use ur logic of complementary business, e fit be like say Julius Berger Furniture go fit buy Okomu Oil Palm one day niyen nau be dat after all Okomu Oil get wood relationship with JB.

Meanwhile, I read say na 1986 Champions Brewery pay dividends last. Any pesin we dey buy champions bury, make him dey tell hin children so dat if hin no collect dividend for hin life time, hin children and grandchildren go collect am.
Igi pawpaw o ni wo pawa o.

Nigerialabalaba:
labalaba dey greet you sir

ololufemi:


I don't think some of those things matter when you consider the fast paced world of trades, acquisitions and mergers in this digital and innovative era. We could be surprised that a lot of companies presumed to have run aground will become beautiful brides for those who see value in them and believe they can turn them around or will benefit from acquiring their assets.

Heineken is a major shareholder in Champion Breweries PLC after acquiring majority shareholding status in the company and will look towards acquiring a 100 percent ownership.

sonofElElyon:


Yes! I've been meaning to ask you... Will take the opportunity now that you mentioned me..
You know labalaba could be butterfly or "was there before us at the hut".. as in "eni a ba laba ni baba". The one we met in the hut (got there before us) is our senior..
Always thought you meant the latter.. we met Nigeria in the hut (Nigeria la ba laba)..
I'm wrong abi?

Nigerialabalaba:


Na dis one sir:

Butterfly:

In its metamorphosis from the common, colorless caterpillar to the exquisite winged creature of delicate beauty, the butterfly has become a metaphor for transformation and hope; across cultures, it has become a symbol for rebirth and resurrection, for the triumph of the spirit and the soul over the physical prison, the material world. Among the ancients, is an emblem of the soul and of unconscious attraction towards light. It is the soul as the opposite of the worm.

In Western culture, the butterfly represents lightness and fickleness. Note Owen Warland's spiritual progression in Nathaniel Hawthorne's Artist of the Beautiful as it parallels the development of the butterfly which he struggles to mechanically recreate. In China, secondary meanings of joy and bliss. Is very closely related to love, especially with wings and when being burned in Cupid's hand that is not holding the bow. Wantonness, especially in Shakespeare. In Yeats, the opposite of the hawk, intuition as opposed to logic.

Na evening school I go o. I be Naija Tokantokan. NGX na d place to dey.

onegentleguy:


UNILEVER has 2 core business lines;
HPC... Home and personal care business segment and
FBS... Food business segment which houses the core of the coys consumer products.

GSK operates on 2 core business lines;
Consumer health care business segment and
the Health/pharmaceutical arm of business.

And you really do not see any relationship btw GSK' consumer health care business segment and UNILEVER' HPC line... or how both segment can sync?

It means you still didn't quite follow the post.
You probably misrepresented matters.
Try reading btw the lines... then relate things to my previous analysis on GSK.

Note that am not saying that a merger, acquisition or buy-out will play out. ...I honestly know nothing about that pls.

Regards

Nigerialabalaba:

As I dey look am so, Kabiyesi Gadaffi dey make sense o becos GSK don sell dia consumer goods section and share d money sef. Also, d 2 industries dey under different regulators (Gsk na pcn and NAFDAC and Unilever na only nafdac), e go easy for Unilever to relate/merge/buy Cadbury dan to buy GSK.

GSK' consumer health care business segment and UNILEVER' Households & Personal Care line no sync like dat o becos of regulation and production lines. Na only on paper e be like say dem sync. Wen GSK try am before, dey suffer wella so dem las las commot dia to face only pharmaceutical.

On paper you go tink say dem relate and sync until you enter u go con see wetin GSK mean wen dem talk say e fit be like panadol but no b panadol

Las las, if I use ur logic of complementary business, e fit be like say Julius Berger Furniture go fit buy Okomu Oil Palm one day niyen nau after all Okomu Oil get wood relationship with JB.

Meanwhile, I read say na 1986 Champions Brewery pay dividends last. Any pesin we dey buy champions bury, make him dey tell hin children so dat if hin no collect dividend for hin life time, hin children and grandchildren go collect am.
Igi pawpaw o ni wo pawa o.

OBAGADAFFI:


Home personal care, isn't related health care/Pharmaceuticals.

Unilever don't have any Pharmaceutical products, not even Paracetamol.

GSK is into vaccine and prescription medicines.

Hope you remember GSK deal with FIDSON.
Why do you think GSK considered FIDSON before Unilever.

onegentleguy:


As I said before, even if its just 0.00001% of that fund that the Nigerian business entity gets... now that's huge!

Last I checked, the company was quite generous to it's Nigerian shareholders when it disposed off of it's lucozade/Ribena drink subset to Asian firm, suntry. ...paying a special dividend of above N7... which was over 40% the mkt price at the time. (just dividend cashflow oo).
That transaction though would be very small when compared to anything that might play out in future. Again, I know nothing about any play.

Pls stop making me talk about GSK. ...enough already.

DrAwo:


The only way gsk Nigeria will profit from the sale by the gsk UK unit is if whoever buys the brands and gsk consumer unit decides to buy GSK Nigerias factories where those consumer products are produced so they can produce it themselves....

A slave cannot expect to be paid just because his master sold him to another slave owner.

I am open to learning and seeing things from your point of view though.

onegentleguy:


For clarity, the part of my post that reads; "even if its just 0.00001% of that fund that the Nigerian business entity gets...", is not indicative of what GSK Intl could pay it's Nig business entity from the £50B figure, but to serve as a yardstick/benchmark to how much fund the Nig arm might get given a similar deal.

In retrospect, if GSK Intl could get as much as £50B for its consumer health care business segment alone, why can't the Nig arm get even if it's 0.0000001% of that figure (I added 3 more zeros this time)

To illustrate; GSK Intl sold their Lucozade/Ribena drink subset to Suntry for £1.3B (<N700B using the Fx rate at the time) and the Nig subset was later sold for N20B... which is approx 0.0285% of the funds gotten from the Intl sale. (i.e 20/700 x 100)

Now assuming we use a similar extrapolation for the proposed consumer health care sale, is it possible that GSK Nig can get, NOT that 0.0285% this time, but maybe a much smaller proportion of 0.0000285% or even a much more minot figure... 0.000001% of that £50B for its Nig consumer health care arm?
And by the way, GSK Intl already turned down the £50B, and are asking for more. ...which means that the plenty of zeros I kept adding to extrapolate/attache an amount for the Nig arm might even be a bit much.

Again, remember that those who would be at the center of the sale of the Nig entity if and when it is sold will still be GSK Intl who hold a majority stake in GSK Nig.
So by implication, the sale of the Nig arm should it materialize, will also not come cheap.
...Just thinking out loud