Top Stocks to Watch: Bajaj Finance, Nykaa, and Varun Beverages

Investors looking for market opportunities on June 22 should closely monitor several key stocks following significant updates from major brokerage houses. From long-term growth guidance in the retail sector to strategic partnerships in the beverage industry, several companies are making headlines through management meets and analyst reports.

Bajaj Finance: Strong Growth and Margin Resilience

JP Morgan has maintained an "overweight" rating on Bajaj Finance, setting a target price of Rs 1,080. Following a recent management meet, analysts highlighted that the company’s growth momentum remains robust, even in the face of macroeconomic headwinds like rising global oil prices and supply chain disruptions.

Crucially, the company's asset quality—including bounce rates and collection efficiency—remains stable across all loan segments, showing no adverse impact from the West Asia conflict. Despite a tight liquidity environment and rising funding costs, management expressed confidence in maintaining a Net Interest Margin (NIM) decline of only 10–12 basis points by FY27. Analysts expect a 26% earnings Compounded Annual Growth Rate (CAGR) over the FY26–FY28 period, driven by healthy loan growth and cost leverage from AI initiatives.

Varun Beverages: Strategic Expansion with Asahi Group

CLSA has issued a "high conviction outperform" rating for Varun Beverages (VBL) with a target price of Rs 654. The positive outlook stems from a new strategic partnership with Asahi Group Holdings to manufacture, distribute, and sell the CALPIS brand in India.

CALPIS, a century-old fermented milk-based beverage from Japan, will allow VBL to enter a differentiated, premium ready-to-drink (RTD) sub-segment, similar to a premium lassi. While Asahi will handle product development and technical support, VBL will leverage its massive manufacturing base and existing cold-chain distribution network to manage marketing and brand operations in India.

Nykaa: Ambitious FY30 Revenue and Margin Targets

Nomura has issued a "buy" rating on Nykaa with a target price of Rs 317, following insights from the company's investor day. Nykaa has laid out an aggressive roadmap for the next several years, aiming to grow its revenue by 2.5x to 3x by FY30.

Furthermore, the company expects to expand its EBITDA margins into the early-to-mid-teens by the end of the decade. As consumer preferences shift toward discovery-led, new-age brands, Nykaa is well-positioned to capture a larger share of premium lifestyle spending through its content ecosystem and owned brands.

Jubilant Foodworks: Navigating Volatility and Margin Expansion

Citigroup has recommended a "buy" on Jubilant Foodworks, setting a target price of Rs 650. While recent quarterly deceleration was noted, analysts attribute this to high base effects and lower delivery thresholds rather than a fundamental drop in demand.

The company is focused on a medium-term like-for-like (LFL) growth range of 5–7% for Domino’s India. To combat cost inflation, management is implementing calibrated pricing and menu adjustments. They are also targeting a 200bps standalone margin expansion between FY24 and FY28. Additionally, the Popeyes brand continues to show improving economics as the company moves toward disciplined scaling.

Key Takeaways

  • Bajaj Finance is positioned for a 26% earnings CAGR through FY28, supported by stable asset quality and AI-driven cost efficiencies.
  • Varun Beverages is diversifying its portfolio into the premium fermented dairy segment through a strategic alliance with Japan's Asahi Group.
  • Nykaa has set high-growth benchmarks for FY30, targeting a 2.5–3x increase in revenue and significantly improved EBITDA margins.