Pepsi bottler Varun Beverages reports higher-than-expected profit
1 min read . Updated: 06 Feb 2023, 02:05 PM IST
PremiumVarun Beverages profited from price increases and increased demand for its more expensive beverages.
On February 6, Varun Beverages announced a quarterly profit that was higher than anticipated. The Pepsi bottler profited from price increases and increased demand for its more expensive beverages, including the Sting energy drink. On average, analysts projected a profit of ₹593.40 million, according to Refinitiv IBES.
Profit for the fourth quarter that ended on December 31 more than doubled to ₹747.5 million from a year earlier, according to the company. To ₹22.57 billion, operating revenue increased by over 28%. For thirty years, PepsiCo-branded beverages have been produced and packaged by Varun Beverages.
As people resumed their regular eating and drinking routines, demand for beverages, especially single-serve bottles, has recovered from epidemic lows, boosting sales of Pepsi, Mirinda and Mountain Dew.
In order to offset the high cost of raw materials, such as the polyethylene terephthalate (PET) plastic used in packaging, Varun Beverages has been taking advantage of this demand by increasing the distribution of its beverages while moderating price increases.
The final dividend, worth ₹1 per share, was also approved by the company's board, bringing the total distribution for the year to ₹3.50. On February 6, shares of Varun, whose value more than doubled in 2022, increased by as high as 7.3%.
In November 2022, Varun Beverages announced a better-than-anticipated third-quarter profit because of pricing increases the Pepsi bottler had implemented to safeguard its margins. In comparison to the same quarter in 2021, the company's net profit increased by 59% to ₹381 crore.
(With agency inputs)
