Varun Beverages posts 20% Q2 revenue growth as brokerages stay bullish despite margin pressure

Varun Beverages reported June-quarter revenue of Rs 8,451 crore, up 20.4% year on year, while volumes rose 19.8%. EBITDA margin narrowed 80 basis points to 27.7%, but brokerages retained positive calls, citing a July demand recovery, international support and longer-term growth potential.

— Source publishedWed, 29 Jul, 2026, 08:19 IST·First seen Wed, 29 Jul, 2026, 08:55 IST·Source NDTV Profit

What happened

Varun Beverages delivered double-digit June-quarter revenue, profit and volume growth, but missed EBITDA and margin estimates. Weak April weather hurt India

Key facts

  • Revenue rose 20.4% YoY to Rs. 8,451 crore
  • EBITDA rose 17.2% YoY to Rs. 2,343 crore
  • EBITDA margin was 27.7%, versus 28.5% a year earlier
  • Net profit rose 15.5% YoY to Rs. 1,521 crore
  • Consolidated sales volume increased 19.8% YoY
  • Jefferies target price: Rs. 615
  • Citi target price cut to Rs. 580 from Rs. 640
  • Morgan Stanley target price: Rs. 557

Why this matters

Varun Beverages’ strong domestic growth and cited international support reinforce the strategic value of expanding scalable bottling, distribution and market-entry capabilities across adjacent high-growth territories.

What to watch

  • Monthly beverage volumes and whether post-July demand remains above high-teen growth.
  • Sequential EBITDA-margin movement in the September and December quarters.
  • PET resin, sugar, concentrate, freight and currency-cost trends.
  • Evidence of pricing realization versus promotional intensity and competitive discounting.
  • International revenue and profitability contribution, especially whether overseas growth is accretive or dilutive to margins.
  • Management commentary on capacity additions, utilization rates, distribution expansion and capex.
  • Brokerage earnings-estimate revisions, particularly changes to FY margin assumptions.
  • Prioritize price-pack architecture and selective price increases to recover input-cost inflation without disrupting volume momentum.
  • Use the July demand rebound to optimize production, route density and plant utilization, seeking operating leverage in the second half.
  • Accelerate higher-margin mix through zero-sugar, juice, energy and premium beverage offerings where available.
  • Maintain disciplined international expansion, emphasizing markets where distribution scale can improve procurement and manufacturing economics.
  • Communicate a clearer margin-recovery path through commodity hedging, packaging-cost actions and productivity targets to protect investor confidence.