Varun Beverages Limited (BSE: 540180 | NSE: VBL), one of the world’s largest PepsiCo bottlers and a leading beverage manufacturer, announced its financial results for the third quarter and nine months ended September 30, 2025. The company posted resilient growth driven by strong performance in international markets and continued expansion initiatives across Africa.
Varun Beverages Limited reported a modest growth in revenue for the third quarter of CY2025, with operations (net of excise/GST) increasing by 1.9% year-on-year to ₹48,966.5 million, compared to ₹48,046.8 million in the same quarter last year. Consolidated sales volumes rose by 2.4% to 273.8 million cases despite extended rainfall across India. While domestic volumes remained largely stable, international markets delivered a robust 9% increase, driven primarily by strong demand in South Africa. The net realization per case stood at ₹178.8 compared to ₹179.6 last year, reflecting a higher share of packaged water in the international portfolio.
In terms of product mix, carbonated soft drinks (CSD) accounted for 74% of total sales, non-carbonated beverages (NCB) contributed 4%, and packaged drinking water made up the remaining 22%. EBITDA for the quarter was ₹11,473.8 million, a slight decline of 0.3% compared to ₹11,511.2 million in Q3 CY2024. Despite this, gross margins improved by 119 basis points to 56.7%, supported by an increased share of water in the international mix and ongoing backward integration initiatives. However, EBITDA margins eased to 23.4% from 24.0%, primarily due to higher operating costs in select markets.
Profit after tax (PAT) for the quarter surged by 18.5% year-on-year to ₹7,451.9 million, compared to ₹6,288.3 million in the corresponding period last year. This growth was largely driven by reduced finance costs and favorable currency movements in international territories, which offset the marginal decline in EBITDA. The company’s international business continues to be a strong contributor, balancing the softer domestic performance affected by seasonal disruptions.
For the nine months ended September 30, 2025, revenue from operations grew by 7.1% to ₹174,809.6 million, compared to ₹163,188.6 million in the same period of 2024. EBITDA rose by 6.8% to ₹44,101.1 million, while PAT increased by 14.9% to ₹28,020.4 million, reflecting sustained profitability across geographies. The company’s focus on health-oriented offerings continued to gain traction, with low and no-sugar beverages comprising 56% of total global volumes and 45% of India’s sales, reinforcing Varun Beverages’ strategic pivot toward evolving consumer preferences.
Ravi Jaipuria, Chairman, Varun Beverages Limited, said “We’ve delivered a steady performance this quarter with consolidated volumes up 2.4%, supported by solid international growth, particularly in South Africa. Despite subdued domestic demand due to prolonged monsoon conditions, our international operations continued to perform strongly. South Africa remains a high-potential market, and we are investing in strengthening our long-term presence there.”
He added, “Our backward integration initiatives are enhancing efficiency and operational strength across key markets. We’re also expanding into Kenya with a new wholly-owned subsidiary under Varun Beverages Limited to manufacture, distribute, and sell beverages. In addition, select African subsidiaries will pilot beer distribution under an exclusive agreement with Carlsberg Breweries A/S, diversifying our product portfolio.”
Mr Jaipuria further noted that the snacks plant in Morocco is now fully operational, and the upcoming Zimbabwe facility is nearing completion—both key steps in broadening the company’s footprint beyond beverages.
“While extended rainfall impacted consumption in India, we remain confident in the strong long-term outlook of the domestic beverage sector. With increasing demand from semi-urban and rural regions, coupled with ongoing investments in capacity, distribution, and cold-chain infrastructure, we are well-positioned for sustained growth,” he said.
Varun Beverages Limited is among the largest franchisees of PepsiCo globally (outside the U.S.), manufacturing and distributing a wide range of carbonated soft drinks (CSDs), non-carbonated beverages (NCBs), and packaged drinking water under PepsiCo trademarks. Key brands include Pepsi, Pepsi Zero, Mountain Dew, Sting, 7UP, Mirinda, Nimbooz Masala Soda, Evervess, Slice, Tropicana (100% & Delight), Gatorade, and Aquafina.
VBL’s partnership with PepsiCo dates back to the 1990s, and today it holds franchise rights across 26 states and 6 Union Territories in India, contributing about 72% of total revenue in FY2024. The company also manages PepsiCo operations in Nepal, Sri Lanka, Morocco, Zambia, Zimbabwe, South Africa, Lesotho, Eswatini, and the Democratic Republic of Congo, with distribution rights in Namibia, Botswana, Mozambique, and Madagascar. Through continuous expansion, product innovation, and diversification, Varun Beverages remains a leading force in the global beverage landscape.
