Varun Beverages reports 24.7% YoY increase in revenue in 2024; expands international footprint

Varun Beverages Limited (VBL) has announced robust financial results for Q4 and year ending December 31, 2024. For CY2024, VBL achieved a 24.7% year-on-year (YoY) increase in revenue from operations, which rose to Rs 20,007.65 crore, up from Rs 16,042.58 crore in 2023.

Consolidated sales volume grew by 23.2% in 2024. The company’s focus on expanding its product mix also paid off. In 2024, low-sugar and no-sugar products accounted for 53% of consolidated sales volumes, up from 42% in 2023.

For the Q4 2024, VBL posted a 38.3% YoY growth in revenue, reaching Rs 3,688 crore. EBITDA for Q4 surged by 38.7% to Rs 579 crore, while PAT grew by 36.1%. This strong performance reflects the ongoing momentum in sales volumes and improved margins.

Furthermore, the company’s Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) rose by 30.5% to Rs 4,711 crore, while the EBITDA margin improved by 105 basis points to 23.5%. This growth was attributed to higher gross margins, despite the consolidation of new markets such as South Africa and the ongoing investment in fixed costs for new capital expenditure (capex). Profit After Tax (PAT) increased by 25.3%.

Commenting on the company's performance, Ravi Jaipuria, Chairman of Varun Beverages, highlighted the company’s successful geographical expansion and its strategic moves in international markets. "VBL made significant strides in South Africa, achieving a 12.5% increase in sales volume in its first year of operations. The company is focusing on reducing reliance on modern trade and expanding its general trade distribution network in the region, including placing more visi-coolers in the market than previous operators. VBL also expanded into new territories, including the Democratic Republic of Congo (DRC), and entered into a share purchase agreement to acquire PepsiCo's businesses in Tanzania and Ghana, which is pending regulatory approvals. These moves are set to strengthen the company’s presence in key international markets, complementing its recent expansion in South Africa."

In addition, VBL ventured into the snacks business with PepsiCo in Morocco, Zimbabwe, and Zambia, diversifying its portfolio and leveraging synergies with its existing infrastructure.

Looking forward, the company plans to deepen market penetration, continue expanding its manufacturing and distribution capabilities, and invest in technology and sustainability initiatives. Strengthening its last-mile distribution and increasing the number of visi-coolers in under-penetrated regions will be key to expanding its consumer base and driving long-term growth.