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Varun Beverages Ltd.    
29 Oct 2021


  • Q3 CY2021:
    • Revenue grew 33% YoY to Rs. 23,982 mn
    • EBITDA higher by 30% YoY to Rs. 4,947 mn
    • PAT higher by 60% YoY to Rs. 2,579 mn
  • 9M CY2021:
    • Revenue higher by 39% YoY to Rs. 70,889 mn
    • EBITDA grew 41% YoY to Rs. 14,471 mn
    • PAT higher by 96% to Rs. 7,135 mn
  • Revenue from operations (net of excise / GST) grew by 33.0% YoY to Rs. 23,981.6 million during Q3 CY2021, primarily on account of robust volume growth over last year and higher realization on a consolidated basis.
    • Realization per case improved by 3.6% to Rs. 156.4 per case in Q3 CY2021 driven by higher realizations in international territories
    • Total sales volumes were up 28.4% YoY at 153.3 million cases in Q3 CY2021 as compared to 119.5 million cases in Q3 CY2020
  • EBITDA increased by 29.9% to Rs. 4,946.6 million from Rs. 3,807.9 million
    • Gross margins declined by 278 bps YoY during Q3 CY2021 primarily because of increase in pet prices in India
    • Healthy EBITDA margin at 20.6% in Q3 CY2021 despite lower gross margins as higher volumes assisted the Company achieve better operating leverage
  • PAT increased by 59.7% YoY to Rs. 2,579.0 million from Rs. 1,614.7 million in Q3 CY2020
    • Finance cost in Q3 CY 2021 declined by 26.4% to Rs. 426.9 million from Rs. 579.6 million in Q3 CY2020
    • The Company continues to reduce its debt and lower its average cost of borrowing
  • Revenue from operations (net of excise / GST) grew 38.5% YoY to Rs. 70,889.0 million as compared to Rs. 51,192.5 million
  • EBITDA improved by 40.5% YoY to Rs. 14,470.8 million from Rs. 10,296.4 million
  • PAT increased by 95.7% YoY to Rs. 7,134.6 million from Rs. 3,645.1 million

Commenting on the performance for Q3 & 9M 2021 Mr. Ravi Jaipuria, Chairman, Varun Beverages Limited said, “We are delighted to share that we have reported a robust performance during the quarter, delivering a top line growth of 33% and a PAT growth of 60% YoY. The results were supported by strong volume growth of 28% driven by uptick in demand across markets. Even on a 2-year CAGR basis, our organic volumes were higher by 11%. Wide vaccination coverage in the country along with resumption in day-to-day activities supported demand momentum in the domestic markets.

On the profitability front, we were able to maintain a healthy EBITDA margin of 21% during the quarter backed by higher operating leverage despite an increase in raw material prices. While the industry practice is that any input cost increase is passed on, we have also worked on our cost efficiencies. For example, we are undertaking measures to light weight PET preforms. This will not only assist us in reducing costs in the near-term, but the benefits would be structural in nature. We are continuously monitoring the input prices to sustain our margin that will enable us to further strengthen our position in the beverage industry.

In addition, we continued to reduce our debt as well as rate of interest which helped us in improving our net profit margin during the quarter.

Following easing of lockdown restrictions and improving macro trends, we witnessed enhanced traction in the domestic demand environment which exceeded pre-pandemic levels. Out-ofhome consumption registered an uptick driven by increase in travel and resumption in offices.

On the whole, we remain optimistic on the demand environment, given improving macros, onset of festive season and a growing sense of normalcy across domestic and international markets.”


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Varun Beverages Ltd. has an average target of 1043.33 from 4 brokers.
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