Varun Beverages Limited (VBL), a key player in the beverage industry, has taken a significant step towards vertical integration by incorporating a new joint venture company in India. The company announced the formation of White Peak Refrigeration Private Limited, which will focus on manufacturing visi-coolers and other refrigeration equipment.

Joint Venture Details

The incorporation of White Peak Refrigeration Private Limited was confirmed by Varun Beverages in a regulatory filing dated September 4. This move aligns with the company's strategy to strengthen its supply chain and potentially reduce costs associated with refrigeration equipment, which is crucial for the beverage industry.

Business Objectives

According to the filing, the primary objectives of the joint venture are to:

• Manufacture visi-coolers
• Produce other refrigeration equipment

This strategic initiative is expected to enhance Varun Beverages' capabilities in managing its cold chain infrastructure, which is essential for maintaining product quality and expanding market reach.

Regulatory Compliance

Varun Beverages has ensured full compliance with regulatory requirements throughout this process:

• The company had previously submitted detailed disclosures on July 29, as required under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
• The latest filing on September 4 serves as an update to the earlier intimation, confirming the actual incorporation of the joint venture.

Market Impact

While the financial terms of the joint venture have not been disclosed in the current announcement, this move is likely to be watched closely by industry observers. The in-house manufacturing of refrigeration equipment could potentially lead to:

• Cost optimizations in Varun Beverages' operations
• Improved control over the quality and supply of critical equipment
• Enhanced ability to customize cooling solutions for various market needs

Looking Ahead

As Varun Beverages continues to expand its operational capabilities, the establishment of White Peak Refrigeration Private Limited marks a notable development in the company's vertical integration efforts. Stakeholders will be keen to see how this joint venture impacts the company's performance and market position in the coming quarters.

The management of Varun Beverages has not provided specific comments on the expected timeline for the joint venture to become operational or its projected impact on the company's financials.

Varun Beverages Limited (VBL), a key player in the beverage industry, has announced plans to invest in renewable energy to power its operations in Rajasthan. The company's Investment and Borrowing Committee has approved the acquisition of up to 26% stake in Jager Renewables Two Private Limited, a move aimed at securing a sustainable and cost-effective power supply for its facilities in the state.

Strategic Investment in Solar Power

Jager Renewables Two Private Limited, incorporated on June 6, 2024, is a special purpose vehicle (SPV) established under the group captive model outlined in the Electricity Act, 2003. The company's primary focus is to generate and supply solar power to consumers in Rajasthan. This strategic investment aligns with Varun Beverages' commitment to environmental sustainability and operational efficiency.

Scope of the Acquisition

The acquisition details include:

• VBL will invest in one or more tranches, with an initial investment of Rs. 26,000 in equity shares.
• The company will acquire 2,600 equity shares with a face value of Rs. 10 each.
• Upon completion, VBL will hold up to 26% of the equity share capital in Jager Renewables Two.

Benefits and Impact

This move is expected to bring several advantages to Varun Beverages:

1. Environmental Sustainability: By investing in solar power, VBL demonstrates its commitment to reducing its carbon footprint.
2. Cost Reduction: The company anticipates a decrease in power costs at its Rajasthan facilities.
3. Operational Efficiency: Solar power will be supplied to VBL's facilities in Kota, Alwar, Jaipur, Jodhpur, and Bhiwadi.

Timeline and Regulatory Compliance

• The transaction is expected to be completed on or before June 2, 2026.
• No specific governmental or regulatory approvals are required for this acquisition.
• The investment does not fall under related party transactions, as confirmed by VBL.

Conclusion

This strategic move by Varun Beverages showcases the company's proactive approach to sustainable business practices and operational optimization. By investing in renewable energy, VBL is positioning itself to meet its power needs more efficiently while contributing to the growth of India's clean energy sector.

The company's decision to disclose this information promptly, in compliance with SEBI regulations, underscores its commitment to transparency and good corporate governance practices.