Varun Beverages Limited has informed the Exchange about Investor Presentation
April 30, 2025
To,
National Stock Exchange of India Ltd. Exchange Plaza, Block G, C/1, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051 Email: cmlist@nse.co.in Symbol: VBL
BSE Limited Phiroze Jeejeebhoy Towers Dalal Street, Mumbai – 400 001 Email: corp.relations@bseindia.com Security Code: 540180
Sub: Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015: Presentation on Unaudited Financial Results of the Company for the Quarter ended March 31, 2025
Dear Sir/Madam,
Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, please find attached herewith a copy of the Presentation on Unaudited Financial Results of the Company for the Quarter ended March 31, 2025.
The same is also being uploaded on website of the Company at www.varunbeverages.com.
You are requested to take the above on record.
Yours faithfully, For Varun Beverages Limited
Ravi Batra Chief Risk Officer & Group Company Secretary
Encl.: As above
April 30, 2025
(a PepsiCo franchisee)
Varun Beverages Limited
Q1 CY2025 Results Presentation
Disclaimer
(a PepsiCo franchisee)
This communication contains certain forward-looking statements relating to the business, financial performance,
strategy and results of Varun Beverages Limited (“VBL” or the “Company”) and/ or the industry in which it operates.
Such forward-looking statements involve a number of risks, uncertainties and assumptions which could cause actual
results or events to differ materially from those expressed or implied by the forward-looking statements. These
include, among other factors, changes in economic, political, regulatory, business or other market conditions.
Neither the Company nor its affiliates or advisors or representatives nor any of its or their parent or subsidiary
undertakings or any such person’s officers or employees guarantees that the assumptions underlying such forward-
looking statements are free from errors nor does either accept any responsibility for the future accuracy of the
forward-looking statements contained
in this presentation or the actual occurrence of the forecasted
developments. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking
statements, on the basis of any subsequent developments, information or events, or otherwise. Given these
uncertainties and other factors, viewers of this communication are cautioned not to place undue reliance on these
forward-looking statements.
2
Table of Contents
Company Overview
Chairman’s Message
Q1 CY2025 Results Overview
Performance Highlights
Sustainability Initiatives
3
Company Snapshot
Key player in the global beverage industry and the second largest franchisee of PepsiCo in the world (outside US) with operations spanning across 10 countries with franchise rights and additional 4 countries with distribution rights.
Total Sales Volumes (mn Cases*)
2019-2024: Sales Volume CAGR: ~18%
1,124
303
913
176
802
149
653
737
821
493
89
404
425
88
337
569
115
454
2019
2020
2021
2022
2023
2024
India
International
Note: *A unit case is equal to 5.678 liters of beverage divided in 24 bottles of ~ 237 ml each
4
Note: Map not to scale
4
Complete Brand Portfolio
Brands licensed by PepsiCo:
Own Brands^:
Carbonated Soft Drinks
Club Soda
Carbonated Soft Drinks
Fruit Pulp / Juice Based Drinks
Energy Drink
Energy Drink
Sports Drink
Carbonated Juice Based Drinks
Ice Tea
Packaged Water
Packaged Water
Snacks#
Dairy Based Beverages*
# Manufacturing of Cheetos (underway) & Distribution of Frito Lay, Doritos and Cheetos in Morocco; Manufacturing (underway) & Distribution of Simba Munchiez in Zambia and Zimbabwe; Co-manufacturing of Kurkure Puffcorn in India. ^ Manufacturing & Distribution of own brands is restricted in select territories. * “CreamBell” trademark has been licensed to be used by VBL for ambient temperature value added dairy based beverages.
5
Symbiotic Relationship with PepsiCo
Demand Delivery
Demand Creation
• Production Facilities
• Sales & Distribution –
GTM & Logistics
• In-outlet Management –
Visi-Coolers
• Consumer Push
Management (BTL) - Market Share Gains
33+
Years of Association (agreement in India valid till April, 2039)
90%+
of PepsiCo India Sales Volume
• Trademarks
• Formulation through
Concentrate
• Product & Packaging innovation through investment in R&D
• Consumer Pull
Management (ATL) - Brand Development
6
Key Player in the Beverage Industry – Business Model
I
N A H C E U L A V S S O R C A N O I T U C E X E D N E - O T - D N E
- L B V
MANUFACTURING
Concentrate (PepsiCo)
Other Raw Materials
Bottling
DISTRIBUTION & WAREHOUSING
CUSTOMER MANAGEMENT
▪ 50 state-of-the-art production facilities
▪ 38 in India & 12 in International territories
SOLID INRASTRUCTURE
▪ 130+ depots ▪ 2,800+ primary distributors with strong distribution infra of 10,000+ vehicles with 2,000+ EVs ▪ 2,600+ owned vehicles
▪ Installed 1.15 million+ visi-coolers, reaching 4 million+ outlets ▪ VBL - local level promotion and in-store activation ▪ PepsiCo - brand development & consumer marketing
ROBUST SUPPLY CHAIN
DEMAND DELIVERY
IN-MARKET EXECUTION
▪ Experienced sales team of over 3,500+ employees ▪ Responsible for category value/volume growth ▪ Path created for reaching out to every 5th person in the world
MARKET SHARE GAINS
COST EFFICIENCIES
▪ Production optimization ▪ Backward integration (3 exclusive + 16 integrated plants) ▪ Innovation (packaging etc.)
MARGIN EXPANSION
CASH MANAGEMENT
▪ Working capital efficiencies ▪ Disciplined capex investment ▪ Territory acquisition
ROE EXPANSION / FUTURE GROWTH 7
7
Chairman’s Message
(a PepsiCo franchisee)
Commenting on the performance for Q1 CY2025, Mr. Ravi Jaipuria, Chairman – Varun Beverages Limited said:
“We are pleased to report a strong operational and financial performance in the first quarter of CY2025. Consolidated sales volumes grew by 30.1% YoY, driven by healthy organic volume growth of 15.5% in India.
The integration of the SA territory has progressed well, with focused efforts on strengthening on-ground infrastructure, streamlining operations, and enhancing execution across the market. We achieved 141 million cases in SA over the trailing four quarters, marking a growth of ~13% over the same period last year. Historically, net realizations in SA are lower due to a higher mix of own brands; however, we are actively working to scale PepsiCo’s portfolio, which is expected to support improvements in realizations and margins going forward.
We recently commenced operations at our new greenfield production facilities in Kangra (Himachal Pradesh) and Prayagraj (Uttar Pradesh), significantly enhancing capacity concurrently with the peak summer season. The implementation of other two greenfield production facilities scheduled for 2025 season in Bihar and Meghalaya is on track and shall commence the commercial production very soon. Additionally, we have established backward integration facilities at Prayagraj and DRC, further strengthening our operational backbone and supply chain efficiency.
Building on our nascent presence in the snack food segment, we have initiated the distribution and sale of PepsiCo’s snack products in Zimbabwe and Zambia. These markets present a significant growth opportunity within the packaged foods category, supporting our focus on portfolio expansion across high-potential regions.
In-line with our dividend policy, the Board of Directors has approved an interim dividend of 25% of face value, i.e., Rs. 0.50 per share, resulting in a total cash outflow of approximately ~Rs. 1,691 million.
Looking ahead, we see immense headroom for growth in India’s beverage market, supported by rising per capita incomes, accelerating urbanisation, expanding electrification, and improving cold-chain infrastructure. With adequate capacities in place, a diversified product portfolio, and a strengthened distribution network, we remain well-positioned to capitalise on these opportunities and deliver sustainable value to all stakeholders.”
8
Key Developments
(a PepsiCo franchisee)
1. Commencement of Commercial Production at Kangra and Prayagraj :
▪ We have commissioned new production facilities at Kangra (Himachal Pradesh) and Prayagraj (Uttar Pradesh).
▪ Further, we have set-up backward integration facilities at our Prayagraj plant in India, as well as at our DRC plant in the
international region.
2. Agreement to distribute & sell PepsiCo’s snack products in Zimbabwe and Zambia :
▪ Varun Zimbabwe and Varun Zambia (subsidiaries of the Company) started distribution & selling of PepsiCo’s snack products in
the territory of Zimbabwe and Zambia w.e.f. 1 February 2025.
3. Dividend :
▪ Final dividend of Rs. 0.50 (Fifty paise only) per equity share of the face value of Rs. 2 each for the year ended 31 December 2024, was approved by the shareholders at the Annual General Meeting held on 03 April 2025 and subsequently paid in April 2025.
▪
In line with the guidelines of Company’s dividend policy, the Board of Director’s have approved an interim dividend @ 25% of face value i.e. Rs. 0.50 per share. Total cash outflow would be ~Rs. 1,691 million.
4. Credit Rating Upgrade :
▪ CRISIL (an S&P Global Company) upgraded the companies long-term rating for bank loan facilities to Crisil AAA/Stable from
Crisil AA+/Stable.
9
Results Overview
Revenue
24.7%
200,077
160,426
n m
. s R
28.9%
43,173
55,669
EBITDA
30.5%
n m
. s R
27.8%
9,888
22.9%
12,640
22.7%
47,111
23.5%
n m
. s R
36,095
22.5%
33.5%
5,480
7,314
(a PepsiCo franchisee)
PAT
25.3%
26,343
21,018
Q1 2024 Q1 2025
CY 2023
CY 2024
Q1 2024 Q1 2025
CY 2023
CY 2024
Q1 2024 Q1 2025
CY 2023
CY 2024
28.1%
402 mn
314 mn
400 300 200 100 -
Quarterly Sales Volumes (Category-wise mn unit cases)
21.9%
267 mn
220 mn
38.1%
215 mn
240 mn
156 mn
30.1%
312 mn
Q2 2023
Q2 2024
Q3 2023
Q3 2024
Q4 2023
Q4 2024
Q1 2024
Q1 2025
Period
Q2 2023
Q2 2024
Q3 2023
Q3 2024
Q4 2023
Q4 2024
Q1 2024
Q1 2025
CSD
NCB
Water
232
74%
307
76%
159
72%
200
75%
106
68%
158
73%
169
71%
234
75%
23
59
7%
19%
32
63
8%
16%
11
50
5%
23%
11
56
4%
21%
8
42
5%
27%
8
49
4%
23%
18
53
7%
22%
22
56
7%
18%
10
Consolidated Profit & Loss Statement
Particulars (Rs. million)
1.Income (a) Revenue from operations
(b) Excise Duty
Net Revenues (c) Other income 2. Expenses (a) Cost of materials consumed (b) Purchase of stock-in-trade (c) Changes in inventories of FG, WIP and stock-in-trade (d) Employee benefits expense (e) Finance costs (f) Depreciation and amortisation expense
(g) Other expenses
Total expenses
EBITDA 3. Profit before share of (loss)/profit of associates and joint venture (1-2)
4. Share of loss of associates and joint venture 5. Profit before tax (3+4)
6. Tax expense
7. Net profit after tax (5-6)
(a PepsiCo franchisee)
Q1 2025
Q1 2024
YoY(%)
CY 2024
CY 2023
YoY (%)
56,800.26
43,979.80
29.2% 204,813.28
163,210.63
1,130.91
806.67
40.2%
4,736.78
2,784.82
55,669.35 280.58
43,173.13 83.53
28.9% 200,076.50 160,425.81 793.59 1212.68 235.9%
26,710.71 711.84 (2,131.92) 5,115.02 411.24 2,725.13
19,309.22 2,352.15 (2,785.88) 3,936.72 936.87 1,875.16
38.3% -69.7% 23.5% 29.9% -56.1% 45.3%
82,937.43 6,859.21 (749.40) 18,850.26 4,503.86 9,473.86
70,264.61 4,626.96 (842.69) 14,465.87 2,680.99 6,809.06
12,624.06
10,473.31
20.5%
45,068.29
35,816.21
46,166.08
36,097.55
27.9% 166,943.51 133,821.01
12,639.64 9,783.85
(5.77) 9,778.08
9,887.61 7,159.11
(1.61) 7,157.50
27.8% 47,110.71 34,345.67 36.7%
-258.4%
(14.78) 36.6% 34,330.89
36,094.85 27,398.39
(4.79) 27,393.60
2,464.50
1,677.68
46.9%
7,988.04
6,375.47
7,313.58
5,479.82
33.5% 26,342.85
21,018.13
25.5%
70.1%
24.7% 52.8%
18.0% 48.2% 11.1% 30.3% 68.0% 39.1%
25.8%
24.8%
30.5% 25.4%
-208.6% 25.3%
25.3%
25.3%
11
Discussion on Financial & Operational Performance
(a PepsiCo franchisee)
Sales Volumes / Net Revenues
• Consolidated sales volume grew by 30.1% to 312.4 million cases in Q1 CY2025 from 240.2 million cases in Q1 CY2024 driven
by strong organic volume growth of 15.5% in India and in-organic volume contributions from South Africa and DRC.
• Net Revenue from operations grew by 28.9% in Q1 CY2025 to Rs. 55,669.4 million from Rs. 43,173.1 million in Q1 CY2024.
• Realization per case increased by 1.8% in India and remained flat in International markets (ex. South Africa). There is a decline of 0.9% in net realization per case at the consolidated level because of lower realization in own brands in South Africa market.
• We have achieved 141 million cases in South Africa in the trailing four quarters which is a ~13% growth over same period
last year.
• CSD constituted 75%, NCB 7% and Packaged Drinking Water 18% in Q1 CY2025
Gross Margins
• Due to relatively lower margin profile of owned brands in the South African market and the higher mix of CSD in India,
Gross margins stood at 54.6%, a decline of 171 basis points as compared to Q1 CY2024.
•
In Q1 CY2025, mix of Low sugar / No sugar products has increased to ~ 59% of our consolidated sales volumes.
12
Discussion on Financial & Operational Performance
(a PepsiCo franchisee)
EBITDA
• EBITDA increased by 27.8% in Q1 CY2025 to Rs. 12,639.6 million from Rs. 9,887.6 million in Q1 CY2024 in-line with Net Revenue
growth.
• EBITDA margins improved in India by 111 bps on account of operational efficiencies from the robust volume growth.
• EBITDA margins marginally declined at the consolidated level by 20 bps because of the lower profitability in South Africa
market @ 14.4% and its higher mix in the Q1 CY2025.
PAT
• PAT increased by 33.5% to Rs. 7,313.6 million in Q1 CY2025 from Rs. 5,479.8 million in Q1 CY2024 driven by robust volume
growth and lower finance cost.
• Depreciation increased by 45.3% on account of commissioning of new plants of last year (Supa, Gorakhpur and Khordha)
which were not present in the base quarter and consolidation of SA & DRC in the current quarter.
• Post repayment of debt through QIP proceeds, finance cost in India is negligible and there is interest income of Rs. 108
million during the quarter.
•
Interest cost in international markets is primarily in South Africa which also includes the lease rentals under Ind AS 116 of Rs. 86 million as the manufacturing facilities in South Africa are on lease.
13
Performance Highlights (CY2019 – CY2024)
(a PepsiCo franchisee)
REVENUE CAGR (2019-24) – 22.9%
71
65
88
n b
. s R
200
160
132
2019
2020
2021
2022
2023
2024
EBITDA CAGR (2019-24) – 26.6%
EBITDA
EBITDA Margins (%)
55.00
45.00
35.00
25.00
15.00 n b 5.00 . s R (5.00)
20.3%
18.6%
18.8%
21.2%
22.5%
23.5%
14
12
17
28
36
47
2019
2020
2021
2022
2023
2024
30%
25%
20%
15%
10%
5%
0%
PAT CAGR (2019-24) – 41.0% 32.00 28.50 25.00 21.50 18.00 14.50 11.00 n b 7.50 . s 4.00 R 0.50 (3.00)
6.6%
5
2019
5.5%
4
2020
PAT
PAT Margins
11.8%
13.1%
13.2%
15.0%
NET WORTH CAGR (2019-24) – 37.9% 200.00
Net Worth
Net D/E
8.5%
16
7
26
21
2021
2022
2023
2024
150.00
100.00
n 50.00 b
. s R -
10.0%
5.0%
0.0%
167
0.0
5.0
4.0
3.0
2.0
1.0
0.0
34
1.0
36
0.8
42
0.7
52
0.7
71
0.7
2019
2020
2021
2022
2023
2024
14
SUSTAINABILITY – Being Water Positive (CDP water rating: A-)
Increase ground water level
2x WRR
Reduce water usage (WUR)
Water consumed Per liter of beverage produced
-26%
by 2025
190+ Water bodies (ponds & check dams) maintained
* Steady state WUR was 1.54 times in 2023 and 1.50 times in 2024, the differential is on account of stabilization of 2 new greenfield plants in 2023 and 3 new greenfield plants in 2024.
Using only half of recharged water for manufacturing
1.89
1.70
1.57*
1.56*
1.40
2021
2022
2023
2024
150+
Process Improvements
2025 Target
15
SUSTAINABILITY – Reducing Carbon Footprint (CDP climate rating: A)
Increase Renewable Energy
30% by 2030
Solar (Rooftop + Captive Power Solution) & Windmill RE Mix % & kWh million units
GHG Emissions
Net Zero
by 2050
Operational boundaries across different scopes
125
79 (16%)
58 (13%)
21 (6%)
18 (7%)
CY2022
CY2023
CY2024
Scope 3
Scope 2
Scope 1
668.2
83.2
21.7
626.5
73.7
17.9
671.0
75.9
19.0
2021
2022
2023
2024
2025E
Note: The increase in GHG emissions is attributed to inorganic acquisitions in CY 2024.
2,000+ EV in trade for last mile
POSITIVE CLIMATE ACTIONS
375K+ Plantations (since 2020)
Efficient Visi Coolers – R290 (all new coolers starting 2023)
16
SUSTAINABILITY – Robust Packaging & Plastic Recycling
Increase Plastic Waste Recycle
Reduce Plastic Usage
Ahead of EPR Regulations
70%
80%
86%
88%
100%
2021
2022
2023
2024
2025E
rPET
~7,000 MT used in 2024
30% rPET mix in packaging by 2025
INDORAMA JV
Pepsi Zero Sugar and Sting energy come in rPET packaging
Packaging rationalization • Removal of pads (20k MT of paper
saving, equivalent to 400k trees)
•
Shrink film and label rationalization
(1.4 MT of material saving)
Closures by 20-25%
CSD/Juices/Water (2010 to-date)
Preforms by 10-20%
600ml to 2.25 liters (2010 to-date)
17
Conference Call Details
(a PepsiCo franchisee)
Varun Beverages Limited Q1 CY2025 Earnings Conference Call
Time
• Wednesday, April 30, 2025 at 2:30 PM IST
Conference dial-in Primary number
• +91 22 6280 1141 / +91 22 7115 8042
International Toll Free Number
• Hong Kong: 800 964 448
• Singapore: 800 101 2045
• UK: 0 808 101 1573
• USA: 1 866 746 2133
18
About Us
(a PepsiCo franchisee)
Varun Beverages Limited (“VBL” or the “Company”) is a key player in beverage industry and one of the largest franchisee of PepsiCo in the world (outside USA). The Company produces and distributes a wide range of carbonated soft drinks (CSDs), as well as a large selection of non-carbonated beverages (NCBs), including packaged drinking water sold under trademarks owned by PepsiCo. PepsiCo CSD brands produced and sold by VBL include Pepsi, Pepsi Zero, Mountain Dew, Sting, Seven-Up, Mirinda, Seven-Up Nimbooz Masala Soda and Evervess. PepsiCo NCB brands produced and sold by the Company include Slice, Tropicana Juices (100% and Delight), Seven-Up Nimbooz, Gatorade as well as packaged drinking water under the brand Aquafina.
VBL has been associated with PepsiCo since the 1990s and have over three decades consolidated its business association with PepsiCo, increasing the number of licensed territories and sub-territories covered by the Company, producing and distributing a wider range of PepsiCo beverages, introducing various SKUs in the portfolio, and expanding the distribution network. As on date, VBL has been granted franchises for various PepsiCo products across 26 States and 6 Union Territories in India. India is the largest market and contributed ~72% of revenues from operations (net) in Fiscal 2024. VBL has also been granted the franchise for various PepsiCo products for the territories of Nepal, Sri Lanka, Morocco, Zambia, Zimbabwe, South Africa, Lesotho, Eswatini & DRC and distribution rights for Namibia, Botswana, Mozambique and Madagascar.
For more information about us, please visit www.varunbeverages.com or contact:
Raj Gandhi / Deepak Dabas / Manjit Singh Chadha Varun Beverages Ltd Tel: +91 124 4643100 / +91 9871100000 / +91 9810779979 E-mail: raj.gandhi@rjcorp.in deepak.dabas@rjcorp.in manjit.chadha@rjcorp.in
Anoop Poojari / Mitesh Jain CDR India Tel: +91 9833090434 / +91 9619444691 E-mail: anoop@cdr-india.com mitesh@cdr-india.com
19
Thank You!