VBL · Fast Moving Consumer Goods
Varun Beverages Ltd. reported revenue of ₹3,689 cr for October to December 2024, +38.3% on the year and −23.2% on the quarter.
Operating profit (EBITDA) was ₹579 cr, a margin of 15.7%, +3 bps on the year and −826 bps on the quarter. It is the narrowest margin of the last 7 quarters (range 15.7% to 27.7%). Operating costs grew +38.2%, broadly with revenue, so operating profit kept pace with sales.
Net profit was ₹196 cr, +36.1% on the year and −68.8% on the quarter, with earnings per share of ₹0.55. Profit before other income, one-offs and tax grew 16.8%, so 19 points of the headline growth came from outside the core business. The tax rate of 23% is in line with its recent average.
On earnings per share of ₹7.97 over the last four quarters, the stock at ₹433.65 trades at 54.4 times trailing earnings.
Written from the quarterly statements. The filing read adds the balance sheet and cash flow, the auditor's review, segment results, one-off items line by line and what management said on the call.
Finance cost rose fast and now takes a large bite of operating profit. New borrowing, or a higher rate?
Source: Quarterly statements
Headline profit grew much faster than core profit. What made up the difference?
Source: Quarterly statements
Could not run on this quarter: Exceptional items that recur, Cash behind the profit, Receivables against sales, Inventory against sales, Borrowing while holding cash, Auditor's review or audit report, IPO money used as stated, Related-party transactions, Exits, postponements, restatements, Promoter pledges and allotments, Earlier promises against delivery, When the results were filed. Most need the filing read (balance sheet, cash flow, auditor, disclosures).
Net profit a year ago, each driver's change, and net profit now. Blue added profit, red took it away.
| Q3 FY24 | Q4 FY24 | Q1 FY25 | Q2 FY25 | Q3 FY25 | Q4 FY25 | Q1 FY26 | Q2 FY26 | Q3 FY26 | Q4 FY26 | Q1 FY27 | Q2 FY27 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | ₹2,668 cr | ₹4,317 cr | ₹7,197 cr | ₹4,805 cr | ₹3,689 cr | ₹5,567 cr | ₹7,017 cr | ₹4,961 cr | ₹4,204 cr | ₹6,574 cr | ₹8,545 cr | ₹6,608 cr |
| YoY | — | — | +28% | +24% | +38% | +29% | −3% | +3% | +14% | +18% | +22% | +33% |
| EBITDA margin | 15.7% | 22.9% | 27.7% | 24.0% | 15.7% | 22.7% | 28.5% | 23.0% | 15.2% | 23.2% | 27.2% | 21.5% |
| Other income, % of PBT | 5% | 1% | 3% | 3% | 18% | 3% | 4% | 16% | 28% | 4% | 5% | 11% |
| Exceptional items | — | — | — | — | — | — | — | — | — | — | — | — |
| Tax rate | 24% | 23% | 24% | 21% | 23% | 25% | 23% | 21% | 28% | 24% | 23% | 21% |
| Net profit | ₹144 cr | ₹548 cr | ₹1,262 cr | ₹629 cr | ₹196 cr | ₹731 cr | ₹1,325 cr | ₹732 cr | ₹260 cr | ₹879 cr | ₹1,510 cr | ₹831 cr |
| YoY | — | — | +26% | +22% | +36% | +33% | +5% | +16% | +33% | +20% | +14% | +14% |
| Core profit YoY | — | — | +28% | +20% | +17% | +34% | +2% | +0% | +24% | +18% | +12% | +20% |
| EPS | ₹0.41 | ₹1.65 | ₹3.86 | ₹1.91 | ₹0.55 | ₹2.15 | ₹3.89 | ₹2.15 | ₹0.74 | ₹2.58 | ₹4.45 | ₹2.45 |
| Flags | · | · | ✓ | ✓ | 2 | ✓ | ✓ | 1 | ✓ | ✓ | ✓ | ✓ |
Each quarter is read with the same rules. Balance-sheet and cash checks run on half-year and annual quarters; filing-read checks run where a read exists.
Varun Beverages Ltd. reported revenue of ₹3,689 cr (+38.3% on the year) and net profit of ₹196 cr (+36.1% on the year) for October to December 2024.
Profit before other income, exceptional items and tax moved +16.8% on the year, against +36.1% for reported profit.
2 checks raised a question: Finance cost rose fast and now takes a large bite of operating profit. New borrowing, or a higher rate?
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