Varun Beverages Shares Tank After Q2 Results Announcement
"Meanwhile, our international markets remained relatively flat, moreover it was a seasonally weak quarter for African market," the company said.
Shares of Varun Beverages Ltd. snapped a four-session gaining streak and fell nearly 7% on Tuesday even after its consolidated net profit rose 26% in the second quarter of calendar year 2024 and met analysts' estimates.
The PepsiCo bottler posted a profit of Rs 1,262 crore in the April–June period, according to an exchange filing on Tuesday.
India volumes grew 23%, while international volumes (before BevCo volumes) were almost flat primarily on account of volumes in Zimbabwe getting affected due to portfolio transition to zero sugar, it said. "Our international markets remained relatively flat, moreover it was a seasonally weak quarter for African market."
VBL Q2 2024 Earnings Highlights (Consolidated, YoY)
Revenue up 24% to Rs 7,197 crore versus Rs 5,811 crore (Bloomberg estimate: Rs 7,344.4 crore).
Ebitda up 16% to Rs 1,991 crore versus Rs 1,711 crore (Estimate: Rs 1,976 crore).
Ebitda margin at 27.7% versus 29.9% (Estimate: 26.9%).
Net profit up 26% to Rs 1,262 crore versus Rs 1,005 crore (Estimate: Rs 1,276 crore).
Dividend Share Split, Announced
Varun Beverages declared an interim dividend and share split along with the results.
The company will pay a dividend of Rs 1.25 per share, leading to a total payout of Rs 162.43 crore. The interim dividend will be disbursed starting Tuesday, Aug. 13, 2024, to eligible shareholders as of Aug. 9, 2024.
The board has also approved the split of existing shares with a face value of Rs 5 each into shares with a face value of Rs 2 each. The action is subject to the shareholders' approval. The company will announce the record date for the share split after receiving the necessary shareholder approvals.
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On the NSE, VBL's stock fell as much as 6.54% during the day to Rs 1,575 apiece, the lowest since July 24. It was trading 4.7% lower at Rs 1,607.90 per share, compared to a 0.5% advance in the benchmark Nifty at 12:28 p.m.
The stock had gained nearly 9% in the last four days. It has risen 29.40% on a year-to-date basis and 98.87% in the last 12 months. The total traded volume so far in the day stood at 3.99 times its 30-day average. The relative strength index was at 49.4.
Seventeen out of the 21 analysts tracking the company have a 'buy' rating on the stock and four recommend 'hold', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 3.1%.
