Motilal Oswal's research report on Varun Beverages
Varun Beverages (VBL) reported a revenue growth of 29% YoY in 1QCY24, led by volume growth of 30% YoY, which was driven by organic volume growth of ~15.5% YoY and consolidation of South Africa & DRC in the current quarter. Realization remained flat YoY at INR178/case. VBL maintained its volume growth trajectory in the domestic market and its expansion in international markets, with the integration in South Africa progressing well. 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).
Outlook
We largely maintain our CY25/CY26 earnings estimates. We reiterate our BUY rating on the stock with a TP of INR 665.
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