Varun Beverages Limited to Raise Fund of Rs. 7500 Crore Through QIP

Varun Beverages (VBL) in a press release has said that the board has approved a proposal to raise funds through the qualified institutional placement (QIP) route by issuing equity shares for up to Rs 7,500 crore in multiple tranches.

The funds raised would be used for general corporate purposes, prepayment and/or repayment of the company’s and/or its subsidiaries’ debts in full or in part, and investments in subsidiaries, joint ventures, or associates in the form of equity, preference capital, or debt. Additionally, the funds would be used to fund the expansion of already-existing businesses, including product portfolio expansion, entry into new markets, and strategic acquisitions.

Performance of Varun Beverages Limited

In Q2 CY24, the company’s consolidated net profit increased by 26.04% to Rs 1,252.60 crore from Rs 993.81 crore in Q2 CY23. In the second quarter of 2024, operating revenue (excise duty excluded) increased by 28.25% YoY to Rs 7,196.86 crore.

Intraday Momentum for Varun Beverages Ltd.’s Stock is Building

Varun Beverages stock price is currently trading at Rs. 595.70 per share, up nearly 1% from its peak trade of Rs. 606.20. This rally is only expected to occur because Varun Beverages plans to raise up to Rs. 7,500 crore via the QIP route.

About VBL 

Founded in 1995 as a division of RJ Corp, Varun Beverages Limited (VBL) has developed into one of the major participants in the beverage market. VBL has extended its reach beyond India to several other countries with a diverse portfolio that includes carbonated soft drinks, non-carbonated beverages, and packaged drinking water under PepsiCo’s trademarks. The recent acquisition of Bevco, a South African bottler for PepsiCo, and the start of production at its Gorakhpur plant by VBL are evidence of the company’s growth and strategic development. As seen by its notable revenue, operating income, and net income as of 2023, VBL showed a strong market presence and operational efficiency.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.