In Focus: Varun Beverages announces record date for stock split; find out here

Shares of Varun Beverages gained attention on Monday, September 2, 2024, following the company's announcement of the record date for its upcoming stock split. The split, approved at a 2:5 ratio during the June quarter earnings declaration, will have Thursday, September 12, 2024, as the "Record Date" to determine shareholders' eligibility for the sub-division of existing equity shares.

"This is to inform you that pursuant to Regulation 42 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors fixed Thursday, September 12, 2024 as the “Record Date” for determining entitlement of Equity Shareholders for the purpose of sub-division / split of existing Equity Shares of the Company, such that each Equity Share having face value of Rs. 5/- (Rupees Five only) each fully paid-up, be subdivided/split into such number of Equity Shares having face value of Rs. 2/- (Rupees Two only) each fully paid-up, as approved by the Equity Shareholders through Postal Ballot on August 30, 2024," the company announced on the exchanges.

Post the announcement, the stock rose as much as 2.1 percent to its day's high of ₹1533.50. It has gained 65 percent in the last 1 year and 24 percent in 2024 YTD.

In June 2023, Varun Beverages implemented a stock split, changing the face value of its shares from ₹10 to ₹5 each. Such stock splits are commonly used to increase the number of outstanding shares, thereby making the stock more accessible and improving trading liquidity. This strategy helps in broadening the shareholder base and facilitating easier market transactions.

Building on this, the company has recently announced another stock split, with the Board of Directors setting September 12, 2024, as the record date. This split is intended to further subdivide the existing equity shares into shares of smaller face value, enhancing affordability and trading volume.

Earnings

For the second quarter ending June 2024, Varun Beverages reported impressive financial performance. The company’s profit after tax (PAT) surged by 26 percent year-on-year to ₹1,261.83 crore. Revenue for the quarter also saw a significant increase of 28 percent year-on-year, rising to ₹7,196.86 crore from ₹5,611.4 crore in the corresponding quarter of the previous year. This robust growth underscores the company's strong operational performance and positive market dynamics.