Others | FMCG
Nov 16, 2018
Varun Beverages Ltd
BUY
CMP
`807
Varun Beverages, a part of the RJ Group, is an India based franchisee of
Stock Info
carbonated soft drinks (“CSDs”) and non-carbonated beverages (“NCBs”) sold
Sector
FMCG
under trademarks owned by PepsiCo. The company produces and distributes
Market Cap (` cr)
14,734
CSDs and NCBs produced from its 20 manufacturing plants spread in India.
52 Week High / Low
848/590
Apart from India, the company operates in Nepal, Sri Lanka, Morocco, Zambia
Avg. Daily Volume
4,522
and Zimbabwe. Currently, its share of Pepsico beverages volume sales increased
Face Value (`)
10
from 26% in FY11 to 51% in FY18. The beverage company is consistent in its
BSE Sensex
35,457
business operations and has delivered a 17.3% and ~53% CAGR in sales and
Nifty
10,628
PAT, respectively over 5 years. Going forward, the company’s sales and profits
Reuters Code
VARB BO
are expected to bolster on account of: 1) Cost savings from backward integration
Bloomberg Code
VBL IN
to widen margins 2) Addition of premium products to portfolio 3) Acquisition of
new areas (domestic and international) for operation is expected to give room for
growth. 4) Leverage distribution network to expand volume sales.
Shareholding Pattern (%)
On account of all the mentioned growth factors we suggest Buy.
Promoters
73.6
MF / Banks / Indian Fls
5.8
FII / NRIs / OCBs
13.0
Indian Public / Others
7.7
Abs. (%)
3m 1yr
3yr
Sensex
(5.9)
7.1
-
VBL
1.6
63.5
-
Jaikishan Parmar
022 - 3935 7600 Ext: 6810
Please refer to important disclosures at the end of this report
1
Varun Beverages Ltd | FMCG
Research Team Tel: 022 - 39357600
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Disclosure of Interest Statement
Varun Beverages
1. Financial interest of research analyst or Angel or his Associate or his relative
No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives
No
3. Served as an officer, director or employee of the company covered under Research
No
4. Broking relationship with company covered under Research
No
Ratings (Based on expected returns
Buy (> 15%)
Accumulate (5% to 15%)
Neutral (-5 to 5%)
over 12 months investment period):
Reduce (-5% to -15%)
Sell (< -15)
2
