Varun Beverages Q3 Revenue Up 33.2% YoY

Date: October 30, 2026

Revenue and Volumes

Revenue from operations grew 33.2% YoY to Rs. 66,075.6 million from Rs. 49,606.9 million in Q3 CY2025.
Consolidated sales volume grew 28.7% to 354.4 million cases from 275.3 million cases.
Volume growth in India was 22.5% and in international territories was 39.9%.
International volumes included 15.3 million cases from the acquisition of Twizza in South Africa.
Consolidated beverage realization per case improved by 2.2%. In India, realization improved by 0.5% due to growth in high-value categories and the launch of premium categories (Ad Rush, Evervess mixers range), calibrated discounting, and efficient price pack architecture.
In International markets, realization improved due to better realization in South Africa and foreign exchange impact.
Product mix: CSD constituted 73.3%, JBD 4.8%, and Packaged Drinking Water 21.9%.

Margins and Costs

Gross margin declined by 334 bps to 53.1%, primarily due to higher packaging material costs (preforms, shrink films, closures, cans) driven by geopolitical disruptions.
Margins were also impacted by a 104% increase in the sale of non-beverage products (like preforms, caps) in India, which have a higher COGS and impacted gross margins by about 100 bps.
A 16% increase in sugar prices was largely offset by an increase in the mix of low sugar / no sugar products, which grew from 44% in Q3 CY2025 to 88% in Q3 CY2026 in India. This considers the sharing of sugar reduction benefits with PepsiCo as part of concentrate cost.
The mix of Low sugar / No sugar products increased to ~86% of consolidated sales volumes in 3M CY2026.

Profitability

EBITDA increased 25.1% YoY to Rs. 14,267.1 million from Rs. 11,404.1 million.
EBITDA margin moderated by 140 bps YoY to 21.6%, primarily due to gross margin contraction, partially offset by operating leverage from volume growth.
Despite supply chain disruptions, EBITDA margins in India remained broadly stable YoY during 9M CY2026.
PAT increased 13.5% YoY to Rs. 8,305.9 million from Rs. 7,315.1 million.
Depreciation increased 34.5% YoY, and finance costs increased 53.5% YoY, primarily due to the acquisition of Twizza in South Africa and associated debt funding.
Other income decreased 18.8% YoY, reflecting relatively stable currency movements.

Revenue from operations grew 23.3% YoY to Rs. 218,145.5 million from Rs. 176,891.2 million.
EBITDA increased 19.9% YoY to Rs. 52,745.8 million from Rs. 44,008.0 million.
PAT increased 15.5% YoY to Rs. 32,023.0 million from Rs. 27,721.2 million.

Incorporation of Subsidiary

On August 29, 2026, the company incorporated a wholly-owned subsidiary in India, KIVA Spirits and Company Limited, to carry on the business of Ready to Drink (RTD), Alcoholic Beverages, and allied products.

Exclusive Distribution Agreement

On September 24, 2026, Varun Beverages (Zimbabwe) (Private) Limited entered into an Exclusive Distribution Agreement with Mondelez South Africa Proprietary Limited for the exclusive distribution of chocolate, biscuit, candy, and gum products of Mondelez in the Republic of Zimbabwe, effective October 1, 2026.

Merger Completion

On July 2, 2026, the Boards of Bevco and Twizza approved the merger of Twizza with its holding company, Bevco. The merger was completed effective August 1, 2026, with significant operational synergies expected in coming quarters.

Dividend

The Board approved an interim dividend of 25% of face value, i.e., Rs. 0.50 per share, resulting in a total cash outflow of ~Rs. 1,691 million.

Mr. Varun Jaipuria, Executive Vice Chairman, commented on the performance:

Strong performance in Q3 CY2026 with consolidated sales volume growth of 28.7%.
In India, healthy volume growth was supported by an extensive distribution network, expanded manufacturing capacities, and investments in chilling infrastructure. Improved realizations were supported by growth in higher-value categories and premium offerings.
International business progressed strongly, with Africa a key continent for expansion. The merger of Twizza with Bevco is complete, and significant operational synergies are expected. Beverage operations started in Kenya with two new brands, 'BOLT UP' and 'XTREME FIZZ'.
The incorporation of KIVA Spirits marks a step in diversifying into adjacent categories like RTD and alcoholic beverages.
Focus remains on driving growth in existing markets and selectively pursuing opportunities to broaden the business while emphasizing profitability and long-term value creation.

VBL follows a calendar year (Jan-Dec) for reporting.
The business is seasonal, with a significant portion of revenues and profits realized in the Apr-June quarter.
During the quarter, subsidiary VBL Industries (Kenya) Limited acquired business from Devyani Food Industries (Kenya) Limited for USD 32 million (Rs. 3,050 million; 1 USD = Rs. 95.30) effective August 1, 2026. This was a business combination under common control, accounted for using the pooling of interests method. Comparative financials have been restated.