Varun Beverages Ltd share Price Today

Varun Beverage (VBL) is one of the largest franchisees of PepsiCo in the world. The company produces & distributes carbonated drinks, juices & packaged drinking water in six countries including India.          Some of the PepsiCo brands produced by VBL include Pepsi, Diet Pepsi, Seven-Up, Mirinda, Mountain Dew, Nimbooz, String, Slice, Tropicana, Aquafina among others.

• The company has operations in India (except Andhra Pradesh, J&K & Ladakh), Sri Lanka, Nepal, Morocco, Zambia and Zimbabwe

Varun Beverages witnessed strong volume growth of 24.7%

• Sales were up 37.7% YoY led by 24.7% volume & 10.4% realisation growth
• EBITDA was at ₹ 798 crore, up 50.3% YoY, with margins at 20.5%
• Consequently, PAT was at ₹ 438.6 crore, up 61.8%

Varun Beverages announced Q4CY23 & CY23 results:

Performance Review for CY23 vs. CY22:

• Revenue from operations (net of excise/GST) showed a YoY growth of 21.8%, reaching Rs 160,425.8 million in CY23, compared to Rs 131,731.4 million in CY22.
  • Consolidated sales volume increased by 13.9% to 912.9 million cases in CY23 from 801.8 million cases in CY22, with double-digit growth in both Indian (12.9% growth) and International (18.0% growth) markets.
  • Net realization per case rose by 7.0% in CY23 to Rs 175.7, driven by an ongoing improvement in the mix of smaller SKUs (250ml) in Indian markets and improved realization per case in International markets.
• EBITDA saw a growth of 29.5%, reaching Rs 36,094.9 million in CY23, up from Rs 27,881.1 million in CY22.
  • EBITDA margin improved by 133 bps to 22.5% in CY23, driven by increased realization and higher gross margins.
• PAT increased by 35.6% to Rs 21,018.1 million in CY23 from Rs 15,501.1 million in CY22, fueled by the growth in revenue from operations and improved profit margins.

Performance Review for Q4CY23 vs. Q4CY22:

• Revenue from operations (net of excise/GST) grew by 20.5% YoY to Rs 26,676.9 million in Q4CY23 from Rs 22,142.4 million in Q4CY22, driven by volume growth in both India and International markets.
• EBITDA increased by 36.0% to Rs 4,182.9 million in Q4CY23 from Rs 3,075.1 million in Q4CY22, led by increased realization, higher gross margins, and improved operational efficiencies.
• PAT increased by 76.3% to Rs 1,437.6 million in Q4CY23 from Rs 815.2 million in Q4CY22, driven by growth in revenue from operations and improved profit margins.

Commenting on the performance for Q4 & CY23 Ravi Jaipuria, Chairman, Varun Beverages said, “Despite the abnormally high unseasonal rains in the peak season, we are pleased to conclude CY2023 on a strong note. We witnessed a healthy double-digit volume growth in both Indian and International markets. Our consolidated sales volume increased by 13.9%, and the net realization per case increased by 7.0% in CY2023. Both these together contributed to our remarkable revenue growth of 21.8% and an impressive PAT growth of 35.6%.

In line with our strategic objectives, we have successfully commissioned multiple greenfield and brownfield facilities across key geographies during the year. This expansion not only strengthened our manufacturing capabilities but also extended our market reach. Our distribution network and chilling infrastructure have also seen a substantial growth, further solidifying our presence in the market.

Marking a key milestone in our growth journey, we are delighted to announce the acquisition of The Beverage Company (BevCo) subject to regulatory and other approvals. BevCo holds franchise rights for PepsiCo beverage products in South Africa, Lesotho, and Eswatini, along with distribution rights in Namibia and Botswana. This acquisition, which aligns perfectly with our strategic goals, offers an excellent opportunity to significantly enhance our presence in the African market—a region known for high demand for soft drinks and favorable demographics. The integration of BevCo into VBL's operations is expected to yield substantial synergistic benefits in the future.

As we move forward, our strategy is geared towards sustaining our healthy growth momentum. We will continue to focus on strengthening our market position, both in India and internationally, and place emphasis on product categories that are aligned with evolving consumer preferences. Our journey through CY2023 has set a solid foundation for continued success, and we remain confident in our ability to deliver sustainable growth and value for all our stakeholders in the years to come.”

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