Shares of Varun Beverages Ltd (VBL) climbed 6% today as the stock turned ex-date for stock split. VBL shares hit an intraday high of Rs 862 (adjusted price) on NSE SE, up nearly 6% over an adjusted closing price of Rs 807 for Wednesday
Varun Beverages stock was split into shares with face value of 5 each on Thursday, June 15, 2023, from Rs 10 apiece on Wednesday. The scrip had closed at Rs 1,614.45 (unadjusted of stock-split) on Wednesday
The 1:2 ratio in the stock split would mean that every 1 existing equity share of Varun Beverages having a face value of Rs 10 each will be subdivided into two equity shares having a face value of Rs 5 each
Varun Beverages is among the top picks of Axis Securities for June month in the large-cap basket as it believes that the Varun Beverages is consistently outperforming its peers in the last several quarters despite volatile environment
Analysts at Axis Securities expect Varun Beverages to perform well on account of normalcy of operation and market share gains of newly acquired territories post Covid-19 disruptions
Varun Beverages is also likely to gain from the management’s continued focus on the efficient go-to-market execution in acquired and underpenetrated territories as reflected in its recently commissioned Bihar plant operations and expansion in its distribution reach to 3.5 million outlets in 2023 from 3 million currently, Axis Securities said
FIIs have also flocked to Varun Beverages shares in the last few years. Data shows that FIIs’ stake in the company has gone up from 19.82% in March 2020 to 26% by the end of March 2023
The company’s net profit jumped 69% YoY to Rs 429 crore in the March quarter. Revenue for the quarter was up 38% YoY to Rs 3,893 crore. Its sales volumes climbed 24.7% to 224.1 million cases, led by strong demand across India. Ebitda margin for the quarter rose 170 basis points YoY to 20.5%
Varun Beverages is focusing on expanding the high-margin Sting energy drink across outlets coupled with an increased focus on the expansion of value-added dairy, sports drink (Gatorade), and juice segments
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