Motilal Oswal Financial Services has reiterated its Buy rating on Varun Beverages Ltd. with a target price of Rs 550, citing a strong and resilient long‑term growth story driven by portfolio diversification, retail expansion and deeper penetration across consumer categories. Notably, VBL also announced the acquisition of South Africa‑based Crickley Dairy. Varun Beverages’ South African subsidiary Bevco to acquire 100 per cent stake in the firm. The share price is currently trading nearly 2 per cent higher at Rs 414 apiece.
Crickley Dairy will be acquired by Bevco from its parent, Clark Holdings Proprietary Ltd. Notably, the recent acquisition marks the foray of Varun Beverages in the value added dairy and juice segment. It transforms VBL’s South African business from a pure PepsiCo bottler into a diversified FMCG player. However, the deal will be subject to regulatory and other approvals including from the Competition Commission of South Africa.
Crickley Dairy manufactures a diversified range of value‑added dairy and beverage products, including full‑cream and low‑fat milk, cream, cheese, yoghurt, and amasi, a traditional fermented milk product. Its portfolio also spans drinking yoghurts, juices, and various dairy blends, giving Varun Beverages an immediate presence across multiple high‑consumption and adjacent FMCG categories in the South African market.
The company’s acquisition is in line with the company’s strategy to diversify its product portfolio into new categories. It is also in line with the company’s strategy to expand business in Africa.
Recent acquisition: Dec 2025
VBL, through its subsidiary Bevco, earlier announced the acquisition of South Africa-based firm Twizza. The company operates in the business of carbonated soft drinks, energy drinks, functional drinks and mixers
Bevco Acquisition: March 2024
VBL acquired the Beverage Company, South Africa, along with its WOSs BevCo. This allowed company’s presence in South Africa, Lesotho, and Eswatini, as well distribution rights in Namibia, Botswana, Mozambique, and Madagascar.
- In its March 16 note the brokergae maintained a ‘Buy’ call with target price at Rs 550
- The proposed acquisition of Twizza in South Africa, which is targeted for completion in the first half of calendar year 2026, is expected to add approximately 6 per cent to Varun Beverages’ volumes, 4 per cent to its revenue, and 3 per cent to its EBITDA, thereby strengthening the company’s overall growth and profitability profile in the region.
- To set up a plant in Africa this year following the distribution agreement with Carlsberg.
- Summer-ready, expect a rebound in 2026.
- VBL’s growth and profitability metrics remain best in the pack.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
