VBL good quarterly results1. Buy or Sell at your own risk
2. Don't risk more than 1%-2% of your capital as stop loss
3. Position Size formula:- Stop Loss Amount/(Buy Price-Initial Stop Loss Price)
4. Sell on initial stop loss hit or daily RSI closing below 40
5. Some other ways to sell stocks can be
a. 25% or 50% up in three weeks or less
b. Weekly tailing tops with high volume
c. Exhaustion gaps
d. Heavy daily volume without further upside
e. Largest one day price drop
On 18th April 2022 NSE:VBL gave a high volume breakout after a consolidation since November 2021. It will be a good buy if it comes down to the support zone of ₹1000 and ₹1040 with a stop at ₹990. It posted a very good set of numbers for the quarter ending on 31st March 2022. its quarterly sales increased by 26%, quarterly profit increased by 96%, TTM sales increased by 34% and TTM profit increased by 103%.
Other fundamentals:
1. Debt to equity at 0.82 (less than 1 is good), Interest Coverage at 7.75 (greater than 3 is good), Current ratio at 1.72 (greater than 1.5 is good).
2. The company has delivered good profit growth of 72.11% CAGR over last 5 years.
3. The company has been maintaining a healthy dividend payout of 17.64%.
4. The management of VBL Recommended the Bonus Issue of Equity Shares in the proportion of 1 (One) Equity Share of Rs. 10/- each for every 2 (Two) Equity Shares of Rs. 10/- each held by the shareholders of the Company.
5. Varun beverages is a part of the RJ group, which is the largest franchisee for Pizza Hut, KFC, Cream Bell and Costa Coffee in India.
6. The Company’s solid and well-entrenched distribution network covers urban, semi-urban, and rural markets, addressing demands of a wide range of consumers. The Company has 32 state-of-the-art manufacturing facilities in India, 6 internationally. It has a robust supply chain with 90+ owned depots, 2,500+ owned vehicles, 1,500+ primary distributors, and currently installed 775,000+ visi-coolers.
7. The Company has established backward integration facilities for production of preforms, crowns, plastic closures, corrugated boxes, corrugated pads, plastic crates, and shrink-wrap films in certain facilities to ensure operational efficiencies and high quality standards. The company also owns 55% stake (35% indirectly & 20% directly) in Lunarmech Technologies Pvt. Ltd. which produces and sells PET bottles caps and crown caps.
8. The company uses around 66,000 MT PET resin as packaging material for its finished products annually. It has engaged with GEM Enviro Management Pvt Ltd for phased implementation of 100% recycling of used PET bottles through collection from end users by placing dustbins reverse vending machines, direct collection from Institutions, etc.
9. In 2019, VBL concluded the acquisition of franchise rights in South and West regions from PepsiCo for a national bottling, sales and distribution footprint in 7 States and 5 Union Territories of India. With these acquisitions, the Company has significantly reinforced its partnership with PepsiCo and now account for over 80% of their India’s beverage sales volumes from 51% earlier.
10. In 2019, Pepsi co extended the bottling appointment and trademark license agreement from Oct 2, 2022 to Apr 30, 2039.
11. Risks: -
a) The Company’s operations span 6 countries – 3 in the Indian Subcontinent (India, Sri Lanka, Nepal), which contributed 85% to total revenues. Currently Nepal and Sri Lanka are going through economic crisis.
b) The beverage industry remains susceptible to changes in government regulations regarding the content of soft drinks, and to increasing environmental concerns in India about ground water depletion and discharge of effluents by bottling plants. Further, evolving concerns related to disposal of plastic may impact the beverages industry.
VBL trade ideas
VARUN BEVERAGES: Strong upward trendNSE:VBL shows strong buy indicated by PSAR, MACD & Fisher crossover.
Target 1: 1135.55
Stop Loss: 1028.30
𝑫𝒊𝒔𝒄𝒍𝒂𝒊𝒎𝒆𝒓:
The analysis is only for illustration purposes only. Please consult your financial advisor, agent, broker before acting on any information. We may or may not have positions in the stock and our actions may be contrary to the one mentioned here. This analysis may or may not be updated. We would not be responsible for the profit/loss resulting from this analysis.
VBL Long opportunityNSE:VBL
Hello all!
VBL has been stuck in a range since August 2021. After about 9 months of consolidation, It is now near its lower trendline and there are high chances that the stock might break out from here.
Though the perfect entry would be after the breakout, accumulation in small quantities can be done here.
*NOT A CALL*
Intraday Trade: watch for resistance breakout buy above 1015 in intraday
For stoploss in Intraday use 5 minute chart and see nearest support.
for target use 5 min chart and fibonacci pivots as i don't keep predefined target.
try to book partially and trail.
Note: this is not a prediction for LONG/SHORT, trade will trigger only on given level as per technical analysis
NOTE: For Gapup or bo before 9:20
If gapup is more than 1% from bo level than avoid completely.
if less than 1% or gives bo before 9:20 than wait for
first 5 minute candle and entry above 5 minute candle
and revised SL below candle Low.
Breaking The Channel Pattern BO of the channel pattern with a huge volume. Seems like it will make a new high in the coming week. One can look for long opportunity at Current Market Price or wait for Retrace.
Plan your trade according to your Risk Management.
This is not a call invest on your own risk.
Please do follow.
Varun Beverages ready for the uptrend!🤩💸🔥Buy Varun Beverages for Positional Trading as well as Investment.💸🔥💸
Comment your views‼️😄
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💡Key triggers for future price-performance:
1) With the normalisation of mobility, a full-fledged summer season after the acquisition of south & west territories is likely to drive robust volume growth.
2) The company has launched several new brands in the last two years i.e. String, ‘Mountain Dew ICE’, milk-based beverages. New products would aid revenues & margins.
3) Given the Capex requirement equal to depreciation, VBL would be able to de-leverage its balance sheet in the next three to four years with strong free cash flow. The reduction in interest cost to boost profitability
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✅Both Technically and Fundamentally strong stock.💪💪
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💎@technofunda_trader
Few Important rules from my Trading Philosophy:
Don't compromise on the quality of stock.
2. Buy right, Sit tight- Only sell in loss if the fundamentals deteriorate, problems arise in management or any other similar issues.
3. Don't invest more than 5-10% in any stock & more than 25% in any particular or related sector.
4. Build position gradually as the stock rises.
5. Trade in the direction of the bigger trend.
6. Ride the trend, don't sell your winners early.
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Like, Comment & Share 😄😄😄
