Varun Beverages shares tumble 7%, hit 52-week low; here's what brokerages say
Varun Beverages shares tumbled 6.76% to a low of Rs 511.45 even as brokerages termed the earnings as largely positive
- Feb 11, 2025,
- Updated Feb 11, 2025 4:58 PM IST
Shares of Varun Beverages Ltd slipped 7% to their 52-week low on Tuesday after the firm reported its Q4 earnings. The FMCG stock tumbled 6.76% to a low of Rs 511.45 even as brokerages termed the earnings as largely positive. A total of 7.08 lakh shares of the firm changed hands, amounting to a turnover of Rs 37.08 crore. Market cap of the firm slipped to Rs 1.78 lakh crore.
The multibagger stock has lost 6% in a year and fallen 20.57% in 2025. It zoomed 103% in two years and gained 313% in three years.
In terms of technicals, the relative strength index (RSI) of Varun Beverages stands at 41.4, signaling the stock is trading neither in the overbought nor in the oversold zone.
Varun Beverages shares are trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 150 day and 200 day moving averages.
The stock has a beta of 0.8, indicating very low volatility in a year.
Global brokerage Citi has retained its buy call but cut target price to Rs 750 from Rs 800. The Q4 earnings were in line with estimates, it said adding that growth drivers remain intact. The brokerage said India growth outlook of the company remains strong.
Axis Securities has maintained its buy call on Varun Beverages with a target price of Rs 710.
"We expect VBL to continue its strong growth momentum in the mid- to long-term. Hence, we maintain our BUY recommendation on the stock," said Axis Securities.
"VBL is expected to maintain its strong growth momentum driven by several key factors: 1) The successful strategic acquisition of the BevCo, which consolidates its presence in South Africa and DRC; 2) Expansion of its snacks portfolio outside India, particularly in Zimbabwe and Zambia; 3) Continued focus on increasing distribution reach, especially in rural areas; 4) The commissioning of multiple greenfield and brownfield facilities, enhancing manufacturing capabilities and market reach while reducing transportation costs; and 5) Expansion of the high-margin Sting energy drink, along with increased emphasis on value-added dairy, sports drinks (Gatorade), and juice segments," added the brokerage.
Motilal Oswal reiterated its BUY rating on the stock noting that the management has guided to continue this growth momentum with double-digit volume growth in the domestic market and a much higher growth rate in international markets.
It expects a CAGR of 12%/11%/17% in revenue/EBITDA/PAT over CY24-26 and largely maintained CY25/CY26 earnings estimates.
"Varun Beverages is expected to maintain its earnings momentum, aided by: 1) increased penetration in newly acquired territories in Africa, 2) stable growth in the domestic market, 3) continued expansion in capacity and distribution reach (10% annual addition in outlets), and 4) growing refrigeration in rural and semi-rural areas. We value the stock at 55x CY26E EPS to arrive at a target price of Rs 680," said Motilal Oswal.
Global brokerage Morgan Stanley has maintained an overweight stance on the stock with a target price of Rs 674. The brokerage reiterated guidance for volume and margins in CY25. The growth momentum remains strong Q1CY25, the brokerage said adding that management is not seeing any effect of competition from Campa in India. The market already had 20% share of B brands, which were cheaper than Pepsi. Distribution expansion opportunity in double digits from 4mn outlets is a key growth driver. The market is large enough to accommodate new competition.
Varun Beverages is a beverage company. It operates franchisee of PepsiCo. The company produces and distributes a range of carbonated soft drinks (CSDs), as well as a large selection of non-carbonated beverages (NCBs), including packaged drinking water sold under trademarks owned by PepsiCo.
Shares of Varun Beverages Ltd slipped 7% to their 52-week low on Tuesday after the firm reported its Q4 earnings. The FMCG stock tumbled 6.76% to a low of Rs 511.45 even as brokerages termed the earnings as largely positive. A total of 7.08 lakh shares of the firm changed hands, amounting to a turnover of Rs 37.08 crore. Market cap of the firm slipped to Rs 1.78 lakh crore.
The multibagger stock has lost 6% in a year and fallen 20.57% in 2025. It zoomed 103% in two years and gained 313% in three years.
In terms of technicals, the relative strength index (RSI) of Varun Beverages stands at 41.4, signaling the stock is trading neither in the overbought nor in the oversold zone.
Varun Beverages shares are trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 150 day and 200 day moving averages.
The stock has a beta of 0.8, indicating very low volatility in a year.
Global brokerage Citi has retained its buy call but cut target price to Rs 750 from Rs 800. The Q4 earnings were in line with estimates, it said adding that growth drivers remain intact. The brokerage said India growth outlook of the company remains strong.
Axis Securities has maintained its buy call on Varun Beverages with a target price of Rs 710.
"We expect VBL to continue its strong growth momentum in the mid- to long-term. Hence, we maintain our BUY recommendation on the stock," said Axis Securities.
"VBL is expected to maintain its strong growth momentum driven by several key factors: 1) The successful strategic acquisition of the BevCo, which consolidates its presence in South Africa and DRC; 2) Expansion of its snacks portfolio outside India, particularly in Zimbabwe and Zambia; 3) Continued focus on increasing distribution reach, especially in rural areas; 4) The commissioning of multiple greenfield and brownfield facilities, enhancing manufacturing capabilities and market reach while reducing transportation costs; and 5) Expansion of the high-margin Sting energy drink, along with increased emphasis on value-added dairy, sports drinks (Gatorade), and juice segments," added the brokerage.
Motilal Oswal reiterated its BUY rating on the stock noting that the management has guided to continue this growth momentum with double-digit volume growth in the domestic market and a much higher growth rate in international markets.
It expects a CAGR of 12%/11%/17% in revenue/EBITDA/PAT over CY24-26 and largely maintained CY25/CY26 earnings estimates.
"Varun Beverages is expected to maintain its earnings momentum, aided by: 1) increased penetration in newly acquired territories in Africa, 2) stable growth in the domestic market, 3) continued expansion in capacity and distribution reach (10% annual addition in outlets), and 4) growing refrigeration in rural and semi-rural areas. We value the stock at 55x CY26E EPS to arrive at a target price of Rs 680," said Motilal Oswal.
Global brokerage Morgan Stanley has maintained an overweight stance on the stock with a target price of Rs 674. The brokerage reiterated guidance for volume and margins in CY25. The growth momentum remains strong Q1CY25, the brokerage said adding that management is not seeing any effect of competition from Campa in India. The market already had 20% share of B brands, which were cheaper than Pepsi. Distribution expansion opportunity in double digits from 4mn outlets is a key growth driver. The market is large enough to accommodate new competition.
Varun Beverages is a beverage company. It operates franchisee of PepsiCo. The company produces and distributes a range of carbonated soft drinks (CSDs), as well as a large selection of non-carbonated beverages (NCBs), including packaged drinking water sold under trademarks owned by PepsiCo.