NEW DELHI, Dec 16: Buoyed by rumours of a bonus, SmithKline Pharmaceutical's scrip zoomed by Rs 50 on the National Stock Exchange (NSE) on Tuesday. The scrip shot up from Rs 480 to Rs 529 and attracted a freeze. On the Bombay Stock Exchange (BSE) too, the scrip shot up from its previous level of Rs 480 to Rs 510, before closing lower at Rs 505. The volumes on BSE rose sharply from an average of around 1,400 to over 3,500 shares on Tuesday.

Although brokers do not expect a liberal bonus from SmithKline Pharma, a bonus in the range of 2:5 to 3:5 is definitely on the cards, said another NSE dealer. The pharmaceutical MNC has a track record of liberal bonus issues and the company's last five bonus issues have been after a gap of three years.

The last two bonus issues by SmithKline Pharma were in 1991 and 1994 and have either been in the month of November or December. The last two bonus issues were in the ratio of 2:5 in 1991 and 1994.

The company's dividend record has also been impressive and in the past three years, the company has declared dividend of 28 per cent, 30 per cent and 35 per cent, respectively.

SmithKline Pharmaceutical's scrip has already outperformed the Sensex in 1997 and shown an appreciation of over 100 per cent.

The scrip has more than doubled from Rs 240 in February this year to the current level of Rs 480 before zooming to Rs 510 at BSE on December 16.

The company has a relatively small equity base of Rs 14.70 crore.

Free reserves of Rs 85.02 crore as on December 1996 stood at more than five times the equity, thereby yielding a healthy book value of over Rs 67.

The company reported a decent growth in the first half ended June 1997, when its sales grew by over 28 per cent to Rs 123.2 crore against Rs 96.02 crore in the corresponding half of last year. Net profit too zoomed by 45 per cent from Rs 9.03 crore to Rs 13.09 crore for the first half ended June 1997.Annualised earnings per share stood at Rs 17.8 against Rs 13.15 for the year ended December 1996.

Interestingly, another group company, SmithKline Beecham Consumer has also been liberal with bonus and dividend announcements. SmithKline Beecham Consumer's latest bonus in the ratio of 3:5 was in 1997 and in the last four years, the company has rewarded shareholders with three bonus issues.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.