Varun Beverages Ltd – Wave 2 Setup at Trendline Support

Varun Beverages Ltd. (VBL), PepsiCo’s second-largest global bottling partner, has been through a long and exhausting corrective phase. On the Elliott Wave chart, this stretched out as a W–X–Y–X–Z sequence, finally bottoming out at ₹449.3.

On the current chart you may not clearly see the entire W–X–Y–X–Z sequence, as it plays out on a slightly smaller scale — but it has been marked.

From that final low of ₹449.3, price started a fresh impulse:

• Wave 1 up, then a tiny Wave 2 ending at ₹450 (just above the start of Wave 1).
  
• A smooth, non-overlapping Wave 3, 4, and 5 followed, with Wave 5 topping at ₹534.20.
  
• This whole structure completes a higher-degree Wave 1.
  

The current decline from ₹534.20 is unfolding as a classic ABC zigzag, which fits perfectly as a Wave 2 correction.

Why this zone matters

• Fibonacci retracement: Price is now testing the 0.786 retrace of the entire rally (449.3 → 534.2).
  
• Trendline support: Aligns with a long-term rising trendline.
  
• Invalidation: As per Elliott rules, Wave 2 cannot break below 449.3 (start of Wave 1). That level is the final stop-loss.
  

Trading roadmap

• Entry Zone: Around 467–470 (Fib + trendline confluence).
  
• Stop-loss: 449.3 (Wave 1 origin).
  
• Targets: A move above 534.20 would confirm Wave 3 is in progress, with further Wave 4 and Wave 5 projections to be plotted as price action evolves.
  

This makes the setup very attractive from a risk–reward perspective: a tight stop vs. potentially large upside.

Fundamentals lining up

• VBL just incorporated its joint venture with White Peak Refrigeration Pvt. Ltd. for visi-coolers and refrigeration equipment.
  
• Q2 CY2025: despite a 3% volume dip, revenue grew 2.5% and net profit rose 5%, aided by efficiencies and lower finance costs.
  
• International volumes (esp. South Africa, +16%) remain strong.
  

So, while the chart points to a possible Wave 2 bottom, the fundamentals also provide support.
(Source: in.tradingview.com/news/moneycontrol:055a897ae094b:0-varun-beverages-announces-joint-venture-for-refrigeration/)

Conclusion
If support holds at current levels, Varun Beverages could be setting up for a strong Wave 3 rally. If ₹449.3 is breached, the bullish impulse count is invalid and the structure must be re-evaluated.

Disclaimer: This analysis is for educational purposes only and does not constitute investment advice. Please do your own research (DYOR) before making any trading decisions.