From 49th Most Valued to Top 4 FMCGs in About Two Weeks, Varun Beverages Briefly Surpasses Britannia The 1995-incorporated company entered the INR One Lakh Crore club on May 10, making it the 48th in the overall market ranking according to BSE data.
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
On Friday, Varun Beverages Limited, the second-largest bottling company in the world for PepsiCo's beverages, briefly surpassed Britannia Industries to become the fourth-largest FMCG firm in India. It followed Hindustan Unilever, ITC, and Nestle India.
Varun Beverages stood at market capitalization of Rs 1.11 lakh crore, which was Rs 25 crore higher than Britannia Industries. However, at the time of publishing this article, Britannia overtook the bottling company, standing at INR 1,09,915 crore. In fact, Varun Beverages now stands lower than Godrej Consumer Products (INR 1,05,277 crore), at INR 1,05,076 crore.
The 1995-incorporated company entered the INR One Lakh crore club on May 10, making it the 48th in the overall market ranking according to BSE data. The company produces and distributes carbonated drinks, juices, and packaged drinking water in India and six other countries. A few of PepsiCo's brands manufactured under them are Pepsi, Slice, Sting, Mirinda, Mountain Dew, Seven-Up, Nimbooz, and Aquafina.
Emkay Global Financial Services analysts maintain a 'BUY" on VBL, with Devanshu Bansal and Bhavika Choudhary adding, "Sting is a huge success, with about 500 bps of incremental contribution to calendar years 2019 through 2022 at a compound growth rate of 23 per cent. Similar traction in new products can surprise positively."
Ninety per cent of the 20 analysts tracking the firm recommend a buy on the stock. Groww, a stocks and mutual funds investment platform, has an expert rating of 87 per cent on the buy recommendation.
VBL's net profit in 2022 (January-December calendar) more than doubled to INR 1,497 crore, while Britannia's net profit for FY 23 grew at a slower pace of 52 per cent. Similarly, the VBL shares more than doubled in the last 12 months, compared to a 30 per cent gain seen on Britannia's shares in the same period.
They also had a strong March quarter growth in terms of volumes and realization and reported a growth of 11 per cent year-on-year in realizations to INR 174 per unit. Savings made on raw material prices, along with an improved product mix, led to an improvement of 90 basis points in gross margin on a year-on-year basis.
Shares of VBL are currently trading at INR 1,701.45.
