Varun Beverages shares are down 19% in 2025, can Q1 earnings trigger a rally in the FMCG stock?

Shares of Varun Beverages are trading in the red in the short term. The stock has lost 19% in 2025 and is down 13% in a year. The recent Q1 earnings of the Pepsico bottler have prompted brokerages to largely trim their price targets but maintain their buy stance on the stock.  

Axis Securities has maintained its buy stance on the stock with a target of Rs 650.  

"We expect VBL to continue its strong growth momentum in the mid- to long-term. Hence, we maintain our BUY recommendation on the stock. Current Valuation: 42xMar-27EPS (Earlier: 48xDec-26EPS) Current TP: Rs 650/share (Earlier TP: Rs 710/ share) Recommendation: With a 25% upside potential from the CMP, we maintain our BUY rating on the stock," said Axis Securities. 

Nuvama has retained its buy call on the FMCG STOCK as the brokerage expects a strong Q2CY25E for VBL due to the ongoing harsh summer. It has kept price target for the stock unchanged to at Rs 659.

The company said its India business shall keep growing at double-digit with expansion via new facilities. Competition is spending more on IPL advertisement while VBL has opted out. 

"India is not ready for Zero Sugar products while Mid-calories products are gaining popularity. In CSD, increased smaller packs’ salience led to higher CoGS, but improved realisation and EBITDA in absolute terms," said the brokerage. 

BOFA has maintained its 'Buy' tag on the stock post Q1 earnings. However, it cut target price to Rs 600 from Rs 630. 
Management is confident on sustaining double-digit volume growth with stable Margins

Jefferies has maintained  a 'Buy' call and trimmed its target price to Rs 650 from Rs 700

Motilal Oswal has a buy call on the stock wih a price target of Rs 665.  

Management is confident about its double-digit growth guidance on the back of industry tailwinds and expansion into new markets every year via the addition of visi-coolers (in domestic and international markets).

"We largely maintain our CY25/CY26 earnings estimates. We reiterate our BUY rating on the stock with a TP of Rs 665," said the brokerage.

In the current session, the VBL stock closed 0.52% higher at Rs 523.70. Market cap of the firm rose to Rs 1.77 lakh crore. 

Varun Beverages reported a 35.2% rise in net profit for the quarter ended March 2025. Profit climbed to Rs 726.4 crore in Q1 against Rs 537.2 crore on a YoY basis. Revenue climbed 29% to Rs 5,567 crore in Q1 against Rs 4,317.4 crore in the year ago period. EBITDA rose 27.8%  to Rs 1,264 cr in the last quarter against Rs 989 cr on a YoY basis. 

The board of the firm announced an interim dividend of Rs 0.50 per share and fixed record date for the same on May 9, 2025.