Hold Varun Beverages, target price Rs 1150: ICICI Securities

ICICI Securities has hold call on Varun Beverages with a target price of Rs 1150. The current market price of Varun Beverages Ltd. is Rs 1126.45.

Varun Beverages Ltd., incorporated in the year 1995, is a Large Cap company (having a market cap of Rs 71905.14 Crore) operating in FMCG sector.

Varun Beverages Ltd. key Products/Revenue Segments include Beverages, Other Operating Revenue, Other Services for the year ending 31-Dec-2021.



Financials
For the quarter ended 30-09-2022, the company reported a Consolidated Total Income of Rs 3258.92 Crore, down -34.37 % from last quarter Total Income of Rs 4965.29 Crore and up 31.55 % from last year same quarter Total Income of Rs 2477.37 Crore. Company reported net profit after tax of Rs 395.48 Crore in latest quarter.

Investment Rationale
The brokerage models the company to report revenue and PAT CAGRs of 26.2% and 40.3% respectively, over CY21-CY24E. Company continues to benefit from its relationship with PepsiCo, pan-India distribution network, backward integration, and increased in-home consumption. It maintains HOLD rating on the stock with a revised DCF-based target price of Rs1,150 (36x CY24E EPS).


Promoter/FII Holdings
Promoters held 63.9 per cent stake in the company as of 30-Sep-2022, while FIIs owned 23.93 per cent, DIIs 4.42 per cent.