Varun Beverages Shares Surge Post C1FY26 Results; Brokerages Stay Bullish, Emkay Sees Rs. 620 Target

Varun Beverages shares extended their rally on Tuesday, supported by strong C1 FY26 earnings and upbeat brokerage commentary. The stock is gaining momentum after a sharp rise in the previous session.

In early trade today, Varun Beverages shares were trading at Rs. 525.2, up 1.22%, after jumping 5.8% in the previous session following its earnings announcement. At the time of writing, the stock was at Rs. 523.30, up 0.86%. Over the past five days, the stock has surged 7.28%, while it has rallied around 36.24 percent in the last month.

On a one-year basis, the stock is down 1.7%, broadly in line with the Nifty 50, which has declined about 1 percent during the same period.

Brokerages remain positive; Emkay maintains buy

Brokerages are largely optimistic on Varun beverages, citing strong demand trends, volume growth, and improving profitability visibility, although some concerns around valuations persist.

Emkay Global maintained a 'buy' rating on the stock with a target price of Rs. 620, implying an upside of around 19.5% from current levels.

The brokerage highlighted an all-round earnings beat, driven by strong volume growth and better realisations. It also raised its EPS estimates by around 5-6% supported by a PAT beat and the addition of the Twizza portfolio.

Margins are expected to remain well supported, aided by strategic PET stocking and lower discounting. Emkay also expects free cash flow (FCF) to improve going forward, while noting that the company's non-carbonated beverage portfolio is scaling up well.

However, the brokerage flagged key risks, including a potential aluminium can shortage and higher gasoline costs, which could impact logistics. Despite this, Varun Beverages continues to benefit from its competitive edge through ongoing investments in distribution and capacity expansion.

Strong C1 FY26 Performance

Varun Beverages reported a robust performance for the quarter ended March 31, 2026, driven by strong demand across key markets.

The company posted consolidated revenue from operations of Rs. 67,215.37 million, compared to Rs. 56,800.26 million in the corresponding quarter last year, reflecting healthy growth. Net profit after tax stood at Rs. 8,787.13 million, underscoring solid operational execution.

EBITDA also witnessed strong growth, with margins expanding to around 23.3%, supported by operating leverage and cost efficiencies.

Operationally, consolidated sales volumes rose 16.3% to 363.4 million cases, led by 14.4 percent growth in India and strong traction in international markets.

Dividend Announcement

Apart from the C1FY26 results, the company's Board approved an interim dividend of Rs. 0.50 per equity share for FY26. The record date has been set as May 1, 2026, with payments scheduled to begin on May 5, 2026.

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