Most brokerages remain bullish on Varun Beverages Ltd. following the company's strong first-quarter earnings and management's optimism about the near-term demand outlook.
According to Morgan Stanley, reasons for this optimism include a strong summer season, a weak base last year, and a shift in the seasonal calendar.
Varun Beverages' earnings in the first quarter of the calendar year 2024 were 13% ahead of Morgan Stanley's estimate and 11% above consensus, with improved margins.
Although India's volume growth was slightly soft due to a seasonal shift, Varun Beverages managed to surpass estimates, driven by improved margins and strong international performance, according to Jefferies.
"The management outlook remains positive, guiding towards a robust summer season with all plants now running at full capacity."
Most brokerages remain bullish on Varun Beverages Ltd. following the company's strong first-quarter earnings and management's optimism about the near-term demand outlook. According to Morgan Stanley, reasons for this optimism include a strong summer season, a weak base last year, and a shift in the seasonal calendar.
Varun Beverages' earnings in the first quarter of the calendar year 2024 were 13% ahead of Morgan Stanley's estimate and 11% above consensus, with improved margins. The company has commissioned new capacity additions ahead of the season, and its plants are operating at full capacity utilization, as noted in their report on May 13.
Although India's volume growth was slightly soft due to a seasonal shift, Varun Beverages managed to surpass estimates, driven by improved margins and strong international performance, according to Jefferies. "The management outlook remains positive, guiding towards a robust summer season with all plants now running at full capacity."
