Mayuri Jain (@mayuri_jain) 49 Followers 12 Aug

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Balance Your Portfolio With Varun Beverages— Pepsico's Largest Franchisee( Outside The US) Shining In Bear Market

Outside of the US, Varun Beverages is the second-largest beverage bottling firm in the world. The PepsiCo franchise deal with Varun Beverages has been extended to April 2039. On June 30, VBL's price was ₹783, and on July 1, the growth trajectory touched ₹790 amid a weak market, a .63% increase in a single day. At the beginning of the year, the price was ₹ 586; now, the price marches on to ₹790, and growth rocketed at 25%.

Varun Beverages Ltd. has provided multi-bagger returns of 412.15% over the past five years and 181.8% over the last three years, respectively. The stock has increased roughly 62.53% over the last year and 23.42% over the previous three months. In terms of returns on investment, the stock has also fared well over the last month. In one month, it returned 9.02%, and in the previous week, 4.91%.

VBL reported significant year over year (YoY) sales growth of 26.2% for the January through March quarter, which was backed by a robust volume increase of 19% YoY across all markets and a higher realisation of 6% YoY. The early start of summer in India, which resulted in more robust demand, drove volume growth.

Earnings before interest, taxes, depreciation, and EBITDA margin expanded by 175 bps to 18.8% in Q1CY22 despite increasing input costs, driven by the better realisation and operating leverage from higher sales volume.

The company's profit after tax (PAT) increased by over 98.2% year over year to Rs 271 crore from Rs 137 crore, thanks to stronger margins, lower financing costs, and more profitable international activities. VBL is anticipated to gain from a robust rebound in the future, driven by rising out-of-home consumption after the pandemic crisis.

VBL's international market, which accounts for 19% of its total volume and has shown impressive CAGR growth of 24% during the period CY15–21, has greater realisation than India.


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