Varun Beverages Q2 Profit Surges 15% to Rs 1,525 Cr

Varun Beverages Ltd (VBL), PepsiCo’s primary franchise bottler, recorded a substantial 15.07% rise in consolidated net profit, hitting Rs 1,525.35 crore for the second quarter of calendar year 2026. This financial uplift was supported by robust double-digit volume expansion observed across both its Indian and international operations.

The company’s revenue from operations also demonstrated strong growth, climbing 20.76% to Rs 8,650.57 crore during the June quarter of 2026. This performance underscores a period of sustained expansion for the beverage giant.

Q2 Sales Volume and Regional Performance

VBL’s consolidated sales volume for the quarter increased by 19.8% year-on-year, reaching a total of 466.7 million cases. This growth was primarily fueled by a 14.4% volume increase within India, alongside a significant 38.4% surge in international territories.

The international expansion included a contribution of 11.8 million cases from the strategic acquisition of Twizza in South Africa. Realization per case for beverages improved by 1.2% at the consolidated level, largely due to enhanced realizations in international markets.

Margin Trends and Expenses

Gross margins for the quarter improved by 44 basis points, reaching 55%. This positive movement was attributed to a higher share of the international business in the overall revenue mix.

However, the EBITDA margin experienced a 76 basis point decline, settling at 27.7%. The company linked this reduction to the consolidation of the Twizza business, which is currently operating at lower margins.

Total expenses for the quarter saw an increase of 23%, amounting to Rs 6,773.49 crore. This rise in operational costs reflects the company’s broader expansion activities.

Half-Year Results and Future Outlook

For the first half of 2026, VBL reported a 19.4% year-on-year growth in revenue from operations, achieving Rs 15,025.42 crore. This indicates a consistent growth trajectory through the initial six months of the year.

Chairman Ravi Jaipuria highlighted the healthy 14.4% volume growth in India since March, with April being the sole exception. He expressed confidence in the long-term growth potential across VBL’s markets, citing favorable demographics, increasing disposable incomes, and rising consumption of packaged beverages as key drivers.

The company’s board also approved a second interim dividend of 50 paise per equity share for 2026. This decision reflects the company’s solid financial standing and commitment to shareholder returns.