Varun Beverages profit up 119% at Rs308.17cr in Q2

We have delivered an encouraging set of results during the quarter, despite a soft operating environment due to pandemic-induced lockdowns and restrictions, Ravi Jaipuria, Chairman, VBL said

Aug 03, 2021 03:08 IST India Infoline News Service

Varun Beverages
Varun Beverages Ltd (VBL) recorded a net profit for the Jun-21 quarter was up 119% yoy at Rs308.17cr as top-line improved yoy resulting in more efficient absorption of fixed costs in the production line.

The 51% growth in EBITDA also showed positive operating traction helping the company along the way. In addition, the company also witnessed a sharp fall in financing costs.

VBL reported a 49.1% rise in total sales revenues for the Jun-21 quarter on a consolidated basis at Rs2,483cr. On a sequential basis, revenues were up 9.39% compared to Rs2,270cr revenues in Mar-21 quarter.

The stock ended at Rs787.25 down by Rs1.95 or 0.25% from its previous closing of Rs789.20 on the BSE. The scrip opened at Rs796.90 and touched a high and low of Rs799.70 and Rs782 respectively.

Commenting on the performance for Q2 2021 Mr. Ravi Jaipuria, Chairman, Varun Beverages Limited said, “We have delivered an encouraging set of results during the quarter, despite a soft operating environment due to pandemic-induced lockdowns and restrictions. While we registered strong sales in the month of April, May witnessed moderate sales on account of the disruptions. I am happy to share that our team efficiently outlined and executed a set of SOPs and workflows to secure our business model and ensure continuity across operations during this time. With last year’s learnings, we had all the necessary protocols in place to handle and mitigate the business impact to a certain extent.”

“Further, as lockdowns and curbs started easing from June onwards, we saw faster recovery in demand, which assisted growth in the quarter. Overall, we have delivered a healthy performance, with a topline growth of 49.4% YoY. The higher growth rate is on account of robust volume growth over a lower base of previous year as well as marginal increase in realizations. On the profitability front, we were able to maintain most of the cost-optimization measures that we had undertaken last year, allowing us to report stable EBITDA margin at 23.3%. PAT increased by 123.0%, primarily driven by lower finance cost on account of lowering of average cost of borrowing and reduction in total debt. We are also pleased to share that in-line with our dividend policy the Board of Director’s have recommended an interim dividend of Rs. 2.5 per share.

As we look ahead, momentum in demand and consumption should further strengthen with higher vaccination drives, improving economic indicators and supportive macros such as good monsoons. We remain confident of reporting robust performance in the quarters ahead,” he added.

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