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.

Varun Beverages Limited has enhanced its corporate guarantee for its South African subsidiary, demonstrating continued commitment to its international operations. The company has also reported resilient quarterly performance despite domestic challenges and made significant strides in international expansion.

Corporate Guarantee Enhancement

Under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Varun Beverages Limited has disclosed the enhancement of its corporate guarantee for The Beverage Company Proprietary Limited (Bevco), its subsidiary in South Africa.

The company has confirmed that promoter/promoter group/group companies have no interest in this transaction, and it is conducted at arm's length with no impact on the listed entity.

Quarterly Performance

Despite a 3.00% decline in consolidated sales volume due to domestic challenges, Varun Beverages managed to maintain its realizations per case and EBITDA margins. This strategic performance resulted in a positive net profit for the quarter, demonstrating the company's ability to navigate market fluctuations effectively.

International Expansion and Product Diversification

In a notable move, Varun Beverages has commenced commercial production of Cheetos, a popular PepsiCo snack product, in Morocco. This marks a significant expansion beyond the company's core beverage portfolio into the snack category, potentially opening new avenues for growth and revenue diversification.

Chairman Ravi Kant Jaipuria emphasized the company's focus on international expansion and diversification strategies. The international segment has been a key driver of growth for Varun Beverages, supported by strong currency movements in international markets.

Strategic Developments in Africa

Varun Beverages is making significant strides in strengthening its presence in Africa:

Future Outlook

Chairman Jaipuria expressed confidence in the company's positioning to capture future opportunities. He highlighted that Varun Beverages is well-equipped to drive long-term value creation through enhanced production capacities, an expanding product portfolio, and a focused distribution network. These strategic initiatives are expected to contribute to the company's growth and market presence in the coming periods.