Varun Beverages Q2 profit jumps 15 per cent as revenue tops Rs 8,650 crore

MUMBAI: The fizz isn’t just in the bottle, it’s flowing straight into the balance sheet. Varun Beverages Ltd (VBL), one of PepsiCo’s largest franchise bottlers globally outside the US, reported a 15.1 per cent year-on-year rise in consolidated net profit for the quarter ended 30 June 2026, driven by strong revenue growth and continued demand across its beverage portfolio.

The company posted a net profit of Rs 1,525.36 crore, up from Rs 1,325.49 crore in the corresponding quarter last year. Sequentially, profit surged from Rs 878.71 crore reported in the March quarter.

Revenue from operations rose 20.8 per cent year-on-year to Rs 8,650.57 crore, compared with Rs 7,163.02 crore a year earlier. Including other income of Rs 104.38 crore, total income climbed to Rs 8,754.95 crore, up from Rs 7,240.18 crore.

The robust topline translated into stronger operating performance. Profit before tax increased 14.2 per cent to Rs 1,977.18 crore, against Rs 1,732.04 crore in the year-ago period, despite higher input and operating costs.

Total expenses rose to Rs 6,773.49 crore, compared with Rs 5,506.95 crore a year earlier, reflecting increased production and distribution volumes.

Among the major cost heads, raw material consumption increased to Rs 3,653.49 crore from Rs 2,845.40 crore, while employee benefit expenses rose to Rs 683.24 crore from Rs 549.66 crore. Depreciation and amortisation stood at Rs 409.04 crore, up from Rs 306.15 crore, while finance costs increased to Rs 56.92 crore from Rs 36.55 crore.

Other operating expenses also climbed to Rs 1,618.60 crore, compared with Rs 1,277.84 crore in the corresponding quarter, mirroring the company’s expanding operations across markets.

For the first six months of 2026, Varun Beverages reported revenue from operations of Rs 15,372.11 crore, up from Rs 12,843.05 crore in the corresponding period last year. Net profit for the half year increased to Rs 2,404.07 crore, compared with Rs 2,056.85 crore, while profit before tax rose to Rs 3,140.37 crore from Rs 2,709.85 crore.

The balance sheet reflected the company’s continued expansion. Total assets increased to Rs 30,210.51 crore as of 30 June 2026, up from Rs 25,565.16 crore at the end of December 2025. Property, plant and equipment grew to Rs 14,635.89 crore, while cash and cash equivalents rose to Rs 2,125.74 crore from Rs 1,784.18 crore.

Operating cash flow remained resilient at Rs 2,535.58 crore during the first half of the year, although the company invested heavily in capacity expansion and acquisitions, resulting in investing cash outflows of Rs 2,497.11 crore. Financing activities generated a net inflow of Rs 297.83 crore, leaving cash and cash equivalents at Rs 2,125.74 crore at the end of June.

The results reinforce Varun Beverages’ position as one of PepsiCo’s fastest-growing bottling partners globally. While rising input costs and capital expenditure continue to keep expenses elevated, sustained revenue growth and expanding scale suggest the company remains well positioned to capitalise on India’s growing appetite for packaged beverages.