Domestically, Varun Beverages Limited (VBL), the biggest PepsiCo bottler in India, is expected to do really well! Antique Broking, a local brokerage firm, thinks the company’s stock could reach Rs 710, which is about a 10% increase from where it is now.
Antique Broking says that VBL will grow because it is entering new drink categories like energy drinks and dairy products. The company is also expanding its factories, which will help it produce more drinks and improve profits. They plan to sell more snacks too, which will help increase their earnings even more.
Recently, VBL made some big moves by buying rights to sell PepsiCo products in Africa, specifically in Tanzania and Ghana. In Tanzania, the market for Pepsi products is huge, with about 200 million cases available. VBL purchased this for Rs 1,750 crore, with hopes of double-digit growth soon. In Ghana, the company earned rights to a smaller market of 20 million cases for Rs 190 crore. This gives VBL a chance to learn more about West Africa and grow its market share there.
The company raised Rs 7,500 crore through a new share sale, which will help it pay for these acquisitions and even buy more stakes in Lunarmech Technologies. Because of these moves, VBL is becoming a “net cash company,” which means it will have more money on hand.
VBL has been working with PepsiCo for over 32 years, covering many areas in India and other countries like Nepal, Sri Lanka, and various African nations.
As of today, Varun Beverages shares were trading slightly lower at Rs 636.30 on the stock market.
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