Varun Beverages Ltd.
FMCG · NSE
52-week range
₹380 – ₹541
From 52w high
-6.0%
RSI (14)
65.6
vs SMA 50 / 200
↑ 50 · ↑ 200
Varun Beverages (VBL) is a PepsiCo bottling franchisee operating across India and select international markets, currently priced at 506 rupees with a trailing PE of 53.8 and forward PE of 41.8. Over the past 5 years the company compounded revenue at 18.1% and earnings at 20% annually, yet free cash flow was positive in only 1 of the tracked years. Debt-to-equity stands at 12.71, an outlier versus FMCG sector peers, alongside a 5.3% drawdown from the 52-week high.
- ✓Revenue and earnings have compounded at 18.1% and 20% respectively over 5 years, placing VBL among the faster-growing large-cap FMCG-adjacent names on NSE.
- ✓Q4 FY26 results showed profit up 20% to approximately 879 crore rupees and revenue up 18.3%, demonstrating consistency with the multi-year growth trajectory.
- ✓Debt trend is classified as falling, and ROE exceeded 15% in 4 of the tracked years, suggesting the elevated leverage has historically co-existed with adequate returns on equity.
- ✓Mean analyst rating of 1.5 across 26 analysts (1-5 scale, lower = more constructive), with recent commentary referencing positive demand outlook and summer-season tailwinds.
- ✗D/E of 12.71 is a significant outlier in the FMCG sector where peers such as HINDUNILVR and BRITANNIA carry leverage well below 1.0; the debt load relative to equity introduces refinancing and interest-burden risk.
- ✗FCF was positive in only 1 of tracked years despite strong earnings growth, a pattern that raises questions about the capital intensity of the bottling-and-distribution model and the conversion of reported profit into cash.
- ✗Quality score of 45 ranks 4th of 6 FMCG peers, below HINDUNILVR (58), NESTLEIND (61), and BRITANNIA (50), reflecting relatively weaker composite quality positioning within the sector.
- ✗ROE for the current period is unavailable, breaking the continuity of the 4-year above-15% ROE track record and making it difficult to assess whether returns on equity have been maintained through the recent high-capex phase.
- ·Q4 FY26 net profit rose 20% to approximately 879 crore rupees with revenue up 18.3%; VBL stock rose approximately 30% during April 2026 ahead of and following the result, with multiple brokerages revising commentary referencing demand outlook and seasonal tailwinds.
- ·The company announced an Africa expansion initiative, signalling international diversification beyond its existing India-plus footprint; geographic expansion adds revenue optionality alongside incremental execution and currency risk.
- ·News sentiment across 8 articles was 6 positive, 2 neutral, 0 negative; the positive skew reflects the post-results period and may not capture any pre-result pressures that contributed to the stock being flat on a 1-year basis prior to April 2026.
- ?Given D/E of 12.71, what is the current interest-coverage ratio, and how sensitive is VBL profitability to a 100-basis-point rise in borrowing costs?
- ?Does the persistent negative FCF over multiple years reflect a deliberate capex-heavy growth phase with a defined payback horizon, or is it structural to the bottling franchise model?
- ?How does the Africa expansion compare in scale and margin profile to existing international operations, and what proportion of group revenue does international currently represent?
- ?With the stock recovering 16% in 3 months after a flat year, does the forward PE of 41.8 already embed the earnings acceleration priced in from Q4 results, or does it lag updated analyst estimates?
PE
53.8
Forward PE
41.8
ROE
—
Profit margin
+14.0%
D/E
12.71
Dividend yield
+0.4%
Quality score
45/100
ROE 5y above 15%
4/5 yrs
FCF 5y positive
1/5 yrs
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.Analysis generated 11 May 2026.