Varun Beverages experienced a notable surge of over 5 percent in its share price during morning trading on the BSE on Tuesday, May 14, propelled by the company’s impressive performance in the March quarter. Opening at ₹1498.15 compared to the previous close of ₹1477.80, the share price soared by 5.5 percent to reach ₹1558.45.
In its exchange filing on Monday, May 13, Varun Beverages reported a 25 percent year-on-year increase in its profit after tax (PAT) for the first quarter of the calendar year, reaching ₹548 crore from ₹438.6 crore in the corresponding quarter last year. This growth was attributed to volume expansion, higher net realization, and enhanced profit margins.
Net revenue also saw a significant uptick, rising by 11 percent year-on-year to ₹4,317.3 crore in Q4 compared to ₹3,893 crore in the same quarter of the previous year. Gross margins improved by 385 basis points to 56.3 percent from 52.4 percent year-on-year, primarily due to decreased PET prices and a focus on reducing sugar content and optimizing packaging.
EBITDA for the quarter witnessed a substantial increase of 23.9 percent year-on-year to ₹988.8 crore from ₹798 crore in the corresponding quarter last year. The EBITDA margin improved by 240 basis points to 22.9 percent in Q1, driven by higher gross margins and increased realization.
Despite facing elevated fixed costs due to new territory acquisitions and the commissioning of new greenfield plants, Varun Beverages managed to improve its EBITDA margin.
Furthermore, the company announced the appointment of Rajesh Chawla as the Chief Financial Officer (CFO) and a Key Managerial Personnel (KMP) effective May 14, 2024, following the resignation of Lalit Malik from the same positions on May 13, 2024.
