Varun Beverages shares fell more than 4% intraday Friday after the Indian drinks maker reported narrower margins in Q3 CY2026 despite strong sales and profit growth.
In its Oct. 30 results release, the company reported net revenue after excise duty and goods and services tax of ₹66.08 billion, up 33.2% year over year. Sales volume increased 28.7% to 354.4 million cases, while EBITDA rose 25.1% to ₹14.27 billion. EBITDA margin narrowed 140 basis points year over year to 21.6%. The company’s release reported the year-over-year comparison. EconoTimes previously noted conflicting prior-year bases in NDTV Profit’s coverage of the results.
Gross margin fell 334 basis points year over year to 53.1%. Varun Beverages linked the decline chiefly to higher packaging costs, citing geopolitical disruption affecting preforms, cans, closures and shrink film.
The company also said Indian sales of non-beverage products, including preforms and caps, rose 104%, reducing domestic gross margin by about 100 basis points. Low-sugar and no-sugar beverages made up 88% of its Indian portfolio, up from 44% a year earlier; the company said the shift helped offset an approximately 16% increase in sugar prices.
Profit after tax rose 13.5% to ₹8.31 billion. Depreciation and amortization expense increased 34.5%, and finance costs rose 53.5%, primarily because of the Twizza acquisition and related debt funding, the company said.
Executive Vice Chairman Varun Jaipuria said higher volumes and better realizations helped cushion the packaging-cost impact. The board approved a third interim dividend of ₹0.50 per share, set Nov. 5 as the record date and said payments would begin Nov. 7.
The Economic Times reported an intraday low of ₹396.55 and listed the shares at ₹402.25, down 3.03%, at 4:04 a.m. ET (08:04 UTC). Business Today cited ₹396.85, down 4%, at 2:36 a.m. ET (06:36 UTC).
