Varun Beverages Share Price Target 2026: Brokerage sees 16% upside for FMCG stock on strong earnings, heatwave-driven demand boost - Markets | Latest News Updates

Varun Beverages Share Price Target 2026: Brokerage firm Motilal Oswal has analysed Varun Beverages Limited, a BSE 100 stock, following its quarterly results, where the company reported a 20 per cent rise in net profit.

Varun Beverages is a key franchisee of PepsiCo, primarily engaged in the manufacturing, distribution, and sale of a wide range of PepsiCo-branded carbonated soft drinks, non-carbonated beverages, and packaged water.

The brokerage has increased the price target for the company by nearly 10 per cent and maintained a positive outlook. It also sees an upside potential of 16 per cent from current price levels. On Monday (April 27), the stock closed 5.8 per cent higher, up by Rs 28.4 at Rs 519.15 on the BSE. (Varun Beverages Share Price)

El Nino and Demand Expectations

The expected upside is largely driven by El Niño conditions, which are likely to bring heatwaves in India. El Niño is a climate pattern in which unusually warm Pacific Ocean waters disrupt weather patterns globally.

Motilal Oswal believes such conditions could support higher demand for beverages, boosting volume-led growth.

Motilal Oswal (MOSL) has maintained a “BUY” rating on Varun Beverages and raised its target price to Rs 600 from Rs 550. This implies an upside of 15.6 per cent from current levels.

The brokerage expects strong volume-led revenue growth, supported by healthy operational performance and improving margins.

It also anticipates an earnings boost driven by an extreme heatwave forecast this year due to El Niño conditions.

MOSL projects a CAGR of 16 per cent in revenue, 16 per cent in EBITDA, and 20 per cent in PAT over CY25–CY27. It has also raised CY26E and CY27E earnings estimates by 4 per cent and 6 per cent, respectively, reflecting stronger growth visibility.

Varun Beverages Limited reported a 20 per cent year-on-year rise in net profit to Rs 878 crore, compared with Rs 731 crore in the same period last year. Revenue from core operations increased 18 per cent to Rs 6,721 crore in the March quarter of CY2025–26, up from Rs 5,680 crore a year earlier.

Earnings per share (EPS) rose to Rs 2.58 in the March quarter, compared to Rs 2.15 in the same period of the previous financial year.

Varun Beverages Limited has shown strong short-term momentum, rising 11.31 per cent in one week, 20.61 per cent in two weeks, and 33.51 per cent over one month.

Since January 1, the stock is up 5.61 per cent. However, it remains slightly negative over one-year and two-year periods, while delivering strong long-term returns of 528.74 per cent over five years.

(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.)

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