News

Emkay Global Financial's research report on Varun Beverages

VBL reported a strong and largely in-line quarter. India revenue growth was better at ~18% (vs expectation of ~15%), helped by ~16%/2% growth in volume/realization. However, International realization declined ~12% on consolidation of a lower-realization South Africa region, leading to in-line consol revenue growth of ~30%. While organic growth trends were healthy in Q1, persistent unseasonal rains in the peak season and scrapping of the Tanzania/Ghana acquisition (7-8% topline contribution) compel a 10-12% cut to our EPS estimate. Notably, VBL expects the high competitive intensity to drive faster expansion of the beverage category, with heightened ATL/BTL investments in an under-penetrated market. While rising competitive intensity poses a margin risk, we maintain India margin estimates with ongoing backward integration at plants, rising low-calorie mix, and PET light-weighting. Despite the earnings cut, we remain confident of VBL delivering double-digit volume growth and considerably outperforming the FMCG pack.

Outlook

We expect VBL to deliver a strong 15%/20% revenue/EPS CAGR over CY24-27E. We maintain BUY while cutting our TP by ~11% to Rs 625 (50x Mar-27E EPS).

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Varun Beverages - 02052025 - emkay

Discover the latest Business News, Budget 2025 News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!

Stock Market Holiday Jammu Kashmir News Live Tim Cook Delhi Rain Heatwave in India Odisha 10th Result 2025 WB Madhyamik Result SSLC Result 2025 Kolkata News IPL Points Table 2025

Business Markets Stocks India News City News Economy Mutual Funds Personal Finance IPO News Startups

Home Currencies Commodities Pre-Market IPO Global Market Bonds

Home Loans up to 50 Lakhs Credit Cards Lifetime Free Finance TrackerNew Fixed Deposits Fixed Deposit Comparison Fixed Income

Home MC 30 Top Ranked Funds ETFs Mutual Fund Screener

Income Tax Calculator EMI Calculator Retirement Planning Gratuity Calculator

Stock Markets

News18 Firstpost CNBC TV18 News18 Hindi Cricketnext Overdrive Topper Learning

About Us Contact Us Advisory Alert Advertise with Us SupportDisclaimer Privacy Policy Cookie Policy Terms & Conditions Financial Terms (Glossary) Sitemap Investors

You are already a Moneycontrol Pro user.