Varun Beverages Ltd, the largest franchise bottler for PepsiCo, reported a significant increase of 25.36 per cent in consolidated net profit, reaching Rs 1,005.42 crore for the quarter ending in June 2023. This growth was driven by increased revenue and improved margins. For the same period last year (April-June quarter), the company recorded a net profit of Rs 802.01 crore.
In the current quarter under review, Varun Beverages Ltd achieved a revenue from operations of Rs 5,699.73 crore, representing a growth of 13.6 per cent compared to the corresponding period in the previous fiscal year, which had a revenue of Rs 5,017.57 crore.
Varun Beverages Ltd’s EBITDA margins also improved, rising by 169 basis points to 26.9 per cent in Q2 CY2023. This improvement was a result of higher gross margins and operational efficiencies.
Consolidated sales volumes for Q2 CY2023 grew by 4.6 per cent to 314 million cases, compared to 300 million cases in Q2 CY2022. This growth was primarily driven by robust performance in international markets. However, sales volume growth in India was impacted by abnormally high unseasonal rains throughout the quarter.
During the first quarter of FY 2023-24, Varun Beverages’ total expenses reached Rs 4,430 crore, representing an 11.68 per cent increase. Total income for the June quarter stood at Rs 5,741.33 crore, showing a growth of 14.18 per cent.
The management expressed satisfaction with the company’s resilient performance in the quarter, despite soft demand in India due to abnormal weather conditions.
It’s worth noting that Varun Beverages Ltd accounts for 90 per cent of PepsiCo’s beverage sales volume in India. The company’s shares closed at Rs 822.05 apiece on the NSE, showing a 1.73 per cent increase from the previous close.