Analyst Concall
Varun Beverages plans no major capex for 2026
This story was originally published at 20:43 IST on 3 February 2026
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--Varun Beverages: Oct-Dec gross margin hit by competition, extended monsoon
--CONTEXT: Comments by Varun Beverages mgmt in post-earnings analyst call
--Varun Beverages: Expect much better, higher volumes in snack foods in 2026
--Varun Beverages: No plans for major capex across the world in 2026
--Varun Beverages: To launch new flavours for Nimbooz, jeera range in March
--Varun Beverages: Plan brownfield unit in South Africa, to be a star market
--Varun Beverages: Focus is on volume growth while maintaining bottom line
--Varun Beverages: 2025 tax cost up on inclusion of taxes for Zimbabwe ops
--Varun Beverages: Calsberg mfg unit in South Africa to start ops in 2027
--Varun Beverages: Have 50% more capacity in India than utilised in 2025
By Akshat Saksena and Sunil Raghu
MUMBAI – Varun Beverages Ltd. does not plan any major capital expenditure around the world in 2026, the company management told analysts in post December quarter earnings concall Tuesday. The only major capital expenditure from the company will be related to the acquisition of Twizza Proprietary Ltd., which the company has already announced. The company said it plans to expand its existing unit in its future star territory South Africa. The management said the acquisition of Twizza would help raise its operational capacity 70-80% and avail the opportunity offered by the market.
The company also has no plan for capital expenditure in India in 2026 as it has enough capacity, its management said. As of today, the company said it has 50% more capacity in India than what they utilise for their non-alcoholic segment. Varun Beverages said its gross margins were affected by higher competition and a bad season caused by the extended monsoons. The company said the competition compelled industry to sell products at discounts.
The company said the inclusion of taxes from its Zimbabwe operations bumped up its tax cost in 2025 for international operations. The company till now had availed a tax break for the Zimbabwe operations, the company's management said.
For India operations in the coming summer season, the company management said that it planned to launch jeera range of its juice based star performer 'Nimbooz' in March. They said going ahead they also plan to launch more flavours and under different price points for the brand. The product comes under its INR 10 product portfolo for which the company says it plans to focus on volume growth while trying to maintain its bottom line.
The company expects its volumes and revenue from the snack food business to grow in 2026, with contribution from Zimbabwe and Morocco, the management said. The company's revenue from its snack food business was around INR 3.40 billion in 2025. As a part of its future projects, the company said it is setting up a Carlsberg greenfield plant in Africa this year and is expecting to start operations by the end of 2027.
On Tuesday, shares of Varun Beverages ended over 3% lower at INR 451.10 on the National Stock Exchange. The company announced its December quarter results during market hours. The company's consolidated net profit rose 36% on year to INR 2.52 billion and its consolidated revenue from operations rose nearly 14% to INR 43.35 billion for the reporting quarter. End
Edited by Akul Nishant Akhoury
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