Varun Beverages shares outlook: Stock up 36% from 52-week low-What should investors do? Targets

Shares of Varun Beverages are in an uptrend since March end, gaining 36% from their 52-week low. The PepsiCo bottler's stock jumped 9% in the last three sessions after Q1 earnings. Apart from the Q4 earnings, the rally in the FMCG stock has been fuelled by a significant rise in demand for beverages due to the ongoing heatwave in India leading to an increase in sales. Additionally, the company's announcement of buying The Beverage Company in South Africa also attracted investor interest in the Varun Beverages stock. 

ALSO READ: Varun Beverages dividend 2026 announced: Check amount, record date, payment date & Q1 earnings 

With the current phase of rally, the Varun Beverages stock is approaching the 52-week high of Rs 543.50 reached on May 6, 2025. 

The FMCG stock has also entered the overbought zone with its RSI reaching 74.7, crossing the 70 mark above which a stock turns overbought on charts. 

In the previous session, Varun Beverages stock ended on a flat note at Rs 518.85 against the previous close of Rs 519.15. Market cap of the firm stood at Rs 1.60 lakh crore. 

On the BSE 100 stock, brokerage firm Motilal Oswal expects a 16% upside from the current level.  

El Nino conditions are likely to bring heatwaves in India. El Nino is a climate pattern in which unusually warm Pacific Ocean waters disrupt weather patterns globally. This could lead to a rise insa les of the firm, boosting volume-led growth, the brokerage said. 

The brokerage projects a CAGR of 16 per cent in revenue, 16 per cent in EBITDA, and 20 per cent in PAT over CY25–CY27. Motilal Oswal also raised CY26E and CY27E earnings estimates by 4 per cent and 6 per cent, respectively, suggesting stronger growth visibility.

Emkay Global Financial Services has raised its price target to Rs 620 from Rs 540. 

The brokerage has raised revenue estimates for CY26 by 6.5 per cent, for CY27 by 7.5 per cent, and for CY28 by 7.7 per cent.
 
Further, EBITDA estimates are up by 6.6 per cent/7.4 per cent/7.9 per cent, net profit estimates are up by 4.9 per cent/5.1 per cent/6.5 per cent for the respective years. 

With a favourable climate so far, the management said growth trends are even better in Q2CY26 (so far). The brokerage noted that VBL is also better placed in terms of margin (compared to peers), with strategic stocking of PET and lower discounting in a strong demand environment.