Varun Beverages Sees 18% Surge in PAT to ₹745 Crore: Q3 Revenue Update

Varun Beverages, a prominent name in the beverage sector, revealed an impressive 18.5% surge in its consolidated Profit After Tax (PAT) for the quarter ending September 2025 (Q3 CY2025). This brought its PAT to Rs 745.2 crore, up from Rs 628.8 crore in the same quarter last year.

Revenue from operations (after deducting excise/GST) for Q3 CY2025 reached Rs 4,896.6 crore, reflecting a modest 1.9% increase from Rs 4,804.7 crore reported in Q3 CY2024.

Factors Driving Profit Growth

The significant profit increase can be attributed to reduced finance costs and enhanced other income, including interest earned on deposits in India, as well as favorable currency exchanges in various international markets. There was a slight dip in the company’s EBITDA, which decreased by 0.3% to Rs 1,147.3 crore in Q3 CY2025 compared to Rs 1,151.2 crore in the previous year. Nevertheless, gross margins improved by 119 basis points to 56.7%, aided by shifts in expenses within international markets and a rise in self-sustaining backward integration efforts.

Despite the positive gross margin, EBITDA margins experienced a decline of 53 basis points, settling at 23.4% from 24.0% in Q3 CY2024, primarily due to increased other expenses.

Sales Volume Insights

Consolidated sales volume grew by 2.4% year-on-year, reaching 273.8 million cases, compared to 267.5 million cases during the same quarter last year. While volumes in India remained relatively stable, international sales saw a significant 9% YoY growth, particularly driven by strong performance in South Africa. In Q3 CY2025, Varun Beverages’ net realization per case was Rs 178.8, slightly down from Rs 179.6 in Q3 CY2024, attributed to a higher proportion of water in international markets. When examining the product mix, carbonated soft drinks (CSD) represented 74%, non-carbonated beverages (NCB) made up 4%, while packaged drinking water accounted for 22%.

Performance Over Nine Months

For the nine months ending September 2025 (9M 2025), Varun Beverages reported a substantial 14.9% year-on-year rise in PAT, totaling Rs 2,802.0 crore compared to Rs 2,438.6 crore in 9M 2024. Revenue from operations also increased, up 7.1% YoY to Rs 17,480.9 crore from Rs 16,318.9 crore during the same period last year.

Notably, low sugar or no added sugar products made up approximately 56% of consolidated sales volumes, with about 45% attributed to the Indian market. EBITDA for the nine-month period surged by 6.8% to Rs 4,410.1 crore, increasing from Rs 4,131.1 crore in 9M 2024.

“While the prolonged monsoon season has influenced consumption patterns in India, we are optimistic about the long-term potential within the domestic beverage sector. With low per capita consumption and increased market penetration in semi-urban and rural areas, the growth opportunities remain significant. Our ongoing investments in capacity expansion, distribution enhancements, and strengthening cold-chain infrastructure prepare us well to meet recovering demand and ensure sustainable growth for all stakeholders,” remarked Ravi Jaipuria, Chairman of Varun Beverages, reflecting on the company’s outlook.

The Q3 results were shared during market hours, resulting in Varun Beverages’ stock trading 7.11% higher at Rs 486.10 on the BSE around 12:35 pm.

What do you think about the beverage industry’s potential growth in the coming years?