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Motilal Oswal Report
Varun Beverages Ltd.'s revenue surged 28% YoY to Rs 22.1 billion (our estimate: Rs 22 billion), aided by strong volume growth (up 18% YoY) and higher realisation (up 9% YoY to Rs 168/ unit case).
Overall volumes increased to 132 million unit cases, backed by a strong performance in India and international territories. Ebitda/unit case grew 26% YoY to Rs 23.3, driven by higher realisation and favorable operating leverage. Ebitda margin expanded 190 bps YoY to 13.9% (estimate: 13.4%).
Varun Beverages' Ebitda jumped 48% YoY to Rs 3.1 billion (estimate: Rs 3 billion). Adjusted profit after tax grew by 4.5 times YoY to Rs 748 million (estimate: Rs 546 million), driven by higher sales growth, improvement in margins and transition to a lower tax rate in India.
Subsidiary sales (consolidated minus standalone) grew 6% YoY to Rs 6.7 billion in Q4 CY22. Ebitda declined 8% YoY to Rs 1.3 billion. Adjusted profit after tax declined 56% YoY to Rs 159 million during the quarter.
Gross margin improved 90 bps YoY, despite the inflationary raw material environment, aided by higher realisation and early stocking of key raw materials. Gross margin/unit case grew 10% YoY to Rs 94.4 Ebitda/unit case improved 26% YoY to Rs 23.3, supported by operating leverage.
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