Varun Beverages rallies 42% off March low as Q1 profit jumps 20% and PepsiCo extends license to 2049
Varun Beverages has rebounded 42% from its March low on the back of a 20.1% YoY jump in Q1 net profit to Rs 878.7 cr and 18.1% revenue growth to Rs 6,574.2 cr. PepsiCo's bottling license extension to 2049, the South Africa Beverage Company buyout, and 0.5 mn outlet additions have prompted YES and Emkay to raise targets to Rs 615-620.
What happened
Varun Beverages stock rebounded 42% from March low on strong Q1 earnings, summer demand, South Africa acquisition of The Beverage Company, and PepsiCo extending
Key facts
- 42% rebound
- 52-week low Rs 381
- 52-week high Rs 541.20
- Q1 net profit Rs 878.7 cr (+20.1% YoY)
- Q1 revenue Rs 6,574.2 cr (+18.1% YoY)
- TP Rs 615 (YES)
- TP Rs 620 (Emkay)
- 0.5 mn outlet addition on 4 mn base
- license extended to 2049
Why this matters
PepsiCo's 24-year license extension and the South Africa Beverage Company acquisition signal that VBL is being positioned as PepsiCo's anchor bottler across emerging markets, opening the door to further AMEA territory tuck-ins.