Varun Beverages reported a massive 68.8 percent year-on-year growth in consolidated profit at Rs 429.07 crore for quarter ended March 2023, driven by strong topline growth, improvement in margins and transition to a lower tax rate.
Consolidated revenue from operations for the quarter came in at Rs 3,893 crore, up by 37.7 percent, supported by robust volume growth and increase in net realisation, the company said in its filing to exchanges on May 2.
Varun Beverages, the second-largest bottling company of PepsiCo's beverages in the world outside the US, follows calendar year as its financial year. At 1:20 pm, the stock was trading flat at Rs 1,445 on the NSE.
The company stated that its net realisation increased by 10.4 percent to Rs 173.7 per case primarily due to price increase in selected SKUs (stock keeping unit) and continued improvement in the mix of smaller SKUs (250 ml), especially in the energy drink segment.
Moreover, company's total sales volumes for the quarter grew by 24.7 percent to 224.1 million cases compared to 179.7 million cases in same period last year backed by strong demand.
The operating performance was also strong as the EBITDA (earnings before interest, tax, depreciation and amortisation) surged 50.3 percent year-on-year to Rs 798 crore, with margin expansion of 170 bps YoY to 20.2 percent for March 2023 quarter.
Varun Beverages said gross margin for Q1 improved by 89 bps to 52.4 percent on yearly basis driven by marginal savings in raw material prices and improved product mix.
"The company achieved remarkable operational and financial performance during the quarter despite weather disruptions in some parts of India in the month of March," said Varun Beverages' chairman Ravi Jaipuria.
On expansion plans, Jaipuria said the company has commissioned greenfield production facility at Kota, Rajasthan and brownfield expansion at 6 facilities. "The additional Greenfield plant in Jabalpur, MP is expected to be operational very soon," he added.
Meanwhile, Varun Beverages said the board of directors has approved the split of existing equity shares of the company from one share with face value of Rs 10 each, into two shares with a face value of Rs 5 each.