Varun Beverages Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Varun Beverages Ltd trades at ₹442, in a confirmed uptrend and 9 weeks into that stage. That is −8.3% against its own 200-day average. It sits at 34% of a 52-week range of ₹389 to ₹544. On relative strength it is currently behind the NIFTY 500 on a trailing-13-week view (7 weeks and counting).

Today the stock is in a confirmed uptrend — week 9 of stage 2, confirmed. At ₹442 it trades −8.3% versus its 200-day average and sits at 34% of its 52-week range (₹389–₹544).

Against the market, two honest reads. Cumulative: over the last 9.7 years the stock moved +1,594% while the NIFTY 500 moved +239% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock is currently behind (7 weeks and counting; last ahead the week of 2026-06-24) — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Varun Beverages Ltd trades at 44.2× P/E, near the bottom of its own range — cheaper only 7% of the time. Its long-run median P/E is 58.3×, measured across 9.7 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 44.2× is near the bottom of its own range — cheaper only 7% of the time, against a long-run median of 58.3× measured over 9.7 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved +17.1% against a −13.6% price move — earnings outran the price, pushing the multiple DOWN its own range.

The price move, decomposed: over 5y, of the +34.2%/yr price move, ~+51.8%/yr came from earnings growth and ~−17.6 pp from the multiple (compressing). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is low against its own past, so the story rests on the earnings line underneath it, not the multiple.

The PEG ratio and its quarterly curve, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 8.2% on reported income across 14 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Stage: Mixed Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Varun Beverages Ltd reads as mixed on its fundamental arc. Mixed — no clean majority across the growth curves, ROCE slipping at 20.0% — the per-curve reads carry the story. The read is built from 8 quarters across 4 curves, on partial evidence.

Why it matters: when the curves disagree, the per-curve reads above matter more than any single verdict.

Return readings here are annual, not quarterly — read as level and direction only; they can confirm the growth curves but never drive the stage on their own.

A partial read: at least one curve is short, or the returns curve is not the computed quarterly series — hold the stage word a little more loosely.

4-Factor Sector Score

49.0/100 — rank 4 of 4 in FMCG - Contract Mfg · 79% evidence confidence

Varun Beverages Ltd scores 49.0 out of 100 against the 4 companies it is compared with in FMCG - Contract Mfg, ranking 4. Balanced evidence: keep at normal research priority and require another comparable period before raising conviction.

The four contributions add to the total exactly: 16.4 + 20.1 + 12.5 + 0 = 49. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Varun Beverages Ltd reported ₹8,451 Cr of revenue in the Jun 26 quarter, +20.4% year on year. That is the 4th straight quarter of year-on-year growth. Over 10 years it has compounded at 20.4% a year. The last full year, FY25, came in at ₹21,685 Cr. The last four reported quarters add to ₹24,126 Cr.

FY25 revenue came in at ₹21,685 Cr (+8.4% on the year), capping 10 years at 20.4% compound. The latest quarter (Jun 26) printed ₹8,451 Cr, +20.4% year on year — the 4th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +13.6% growth against the decade's 20.4% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +14.5% over the last 4 quarters against +15.6%/yr over the last 8 — stabilising; TTM profit +18.3% vs +17.5%/yr — stabilising.

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Varun Beverages Ltd's operating margin is 28.0% in the Jun 26 quarter, +0.0 percentage points against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 15.0% to 24.0%. The current quarter is running above every full year in that window.

The latest quarter's operating margin is 28.0%, +0.0 pp against the same quarter a year ago. Across 12 fiscal years the operating margin has ranged 15.0%–24.0%.

🚨 Why the margin moved: operating margin went −0.8 pp year on year while gross margin went +0.4 pp — the loss came mostly below the gross line: operating leverage, with costs spread over a bigger revenue base.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Varun Beverages Ltd earned ₹1,525 Cr of net profit in the Jun 26 quarter, +15.1% year on year. It is the 11th consecutive quarter of growth. Full-year FY25 profit was ₹3,062 Cr. The 10-year compound rate is 39.1%. That is 18.0% of the quarter's revenue. The same quarter a year earlier earned ₹1,325 Cr.

Jun 26 profit was ₹1,525 Cr, +15.1% year on year — the 11th consecutive quarter of growth. On the full year, FY25 printed ₹3,062 Cr (+16.2%), and the 10-year compound rate is 39.1%.

Why profit moved: revenue contributed +20.4% and the margin +0.0 pp — the quarter was revenue-led, with the margin roughly flat.

Pace comparison, last four quarters: profit +21.6% vs revenue +13.6%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 119% of Varun Beverages Ltd's reported profit arrived as operating cash — the cash follows the profit. In FY25 that was ₹3,509 Cr of operating cash against ₹3,062 Cr of profit. After ₹3,677 Cr of capital spending, ₹−168 Cr was left as free cash.

FY25: operating cash of ₹3,509 Cr against reported profit of ₹3,062 Cr, leaving free cash of ₹−168 Cr after ₹3,677 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 119% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 119%: the cash cycle held roughly steady between FY20 and FY25 — so conversion tracks profitability rather than the cycle.

Router verdict: the bigger cash user is investment — capital spending ran 4.3× depreciation over three years, so the next section's job is to check what that build-out is buying.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Varun Beverages Ltd's cash conversion cycle runs 79 days in FY25, up from 69 days in FY20. Capital spending ran ₹12,335 Cr over the last 3 years. At FY25 sales of ₹21,685 Cr each day of that cycle holds about ₹59.4 Cr, so roughly ₹4,693 Cr sits inside the business at any moment.

FY25: debtors at 21 days, inventory at 111 days — roughly 3.7 months of stock waiting to sell; that is where the cash sits while it waits — for a full cycle of 79 days, looser than FY20's 69.

The full loop: cash goes out to suppliers and production on day 0; stock waits 111 days to sell; customers pay about 21 days after that; and suppliers themselves are paid at 53 days — netting out to the 79-day cycle.

In money terms: at FY25 sales of ₹21,685 Cr, each day of the cycle holds about ₹59.4 Cr — so the 79-day loop keeps roughly ₹4,693 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹12,335 Cr over the last 3 fiscal years against ₹2,844 Cr of depreciation — the company is building well ahead of wear-and-tear. Capital work-in-progress stands at ₹271 Cr (FY25) — capacity paid for but not yet earning.

The synthesis: the cash is going into capacity, not disappearing into the cycle — the question becomes whether the new capacity earns.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Varun Beverages Ltd earns a ROCE of 20% in FY25. That is up from a trough of 7% in FY14. A return-on-invested-capital spread against the cost of capital is not computable from what is held here. The wiring behind it is 14.1% net margin on 0.85× asset turns.

FY25 ROCE is 20%, recovered from a FY14 trough of 7% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY25): 14.1% net margin × 0.85× asset turns × 1.30× balance-sheet leverage ≈ 15.6% on equity. Margin does its share; leverage is modest — this is an earned return, not a borrowed one.

The quarterly return curves and the return-on-invested-capital overlay, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 8.2% on reported income across 14 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Debt Debt-to-equity says how much of the business is funded by borrowings; interest cover says how many times operating profit pays the interest bill. Low and high, respectively, is the safe corner.

Varun Beverages Ltd carries ₹2,508 Cr of borrowings against ₹19,578 Cr of equity in FY25, a debt-to-equity of 0.13. Operating profit covers the interest bill 26×. Over 5 years borrowings went from ₹3,216 Cr to ₹2,508 Cr. Capital spending ran ₹12,335 Cr across the last 3 of those years.

FY25: borrowings of ₹2,508 Cr against equity of ₹19,578 Cr — a debt-to-equity of 0.13. Operating profit covers the interest bill 26×. Over 5 years borrowings went from ₹3,216 Cr to ₹2,508 Cr while capital spending ran ₹12,335 Cr in just the last 3 — the build-out is being paid for out of cash, not debt.

The total-debt and debt-to-equity series, which only the second data source carries, are not drawn on this page: its two data sources disagree by up to 8.2% on reported income across 14 comparable periods. A figure two sources cannot agree on is not drawn — the gap is a decision, not missing data.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Domestic institutions added 10.6 points of Varun Beverages Ltd over 8 quarters, the biggest move on the register. That takes domestic institutions to 15.2% of the company. Foreign institutions moved −6.3 points over the same window, to 19.0%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Domestic institutions: +10.6 points over 8 quarters to 15.2%; Foreign institutions: −6.3 points over 8 quarters to 19.0%; Promoters: −3.2 points over 8 quarters to 59.4%.

Why the register moved: rotation — foreign institutions −6.3 points against domestic institutions +10.6 points over 8 quarters, with promoters −3.2 points — one class of institutions handing the register to the other, not a verdict change by the people closest to the numbers.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Varun Beverages Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

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