Indian Pepsi bottler Varun Beverages beats quarterly profit forecast on strong demand

Indian Pepsi bottler Varun Beverages beats quarterly profit forecast on strong demand
Indian Pepsi bottler Varun Beverages beats quarterly profit forecast on strong demand

Varun Beverages on Monday reported a quarterly profit that beat market expectations, as Pepsi’s Indian bottler benefited from a surge in demand for soft drinks due to the early arrival of summer.

Consolidated net profit of Gurugram-based Varun Beverages increased to 5.37 billion rupees ($64.3 million) for the quarter ended March 31, compared to 4.29 billion rupees in the same period of the ‘last year. It beat analysts’ estimates of 5.02 billion rupees, according to LSEG data.

Consumers opted more for cold drinks during the sweltering summer heat, which helped boost the company’s bottom line.

Last month, India’s meteorological department predicted that the country would likely experience more heatwave days than normal between April and June.

The franchisee has been manufacturing and bottling PepsiCo brand beverages for over thirty years and operates in ten countries.

The company said in a stock filing that its earnings before interest, taxes, depreciation and amortization (EBITDA) increased 23.9% from a year earlier.

Varun Beverages, known for producing and bottling various beverages such as Mirinda, Mountain Dew and Tropicana, said its operating income during the reported quarter increased by 11.3% to 43.98 billion of rupees from one year to the next.

In volatile trade, the company’s shares were down 1% at 1,449 rupees, as of 0711 GMT.

Including session prices, the stock has climbed 18.4% so far in 2024, compared with a 3% decline in the fast-moving consumer goods index.

($1 = 83.5050 Indian rupees) (Reporting by Navamya Ganesh Acharya in Bengaluru; Editing by Sherry Jacob-Phillips)

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