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Informist, Monday, Apr. 27, 2026

By Avishek Rakshit & Gunjan Rajput

KOLKATA/NEW DELHI – In wake of the war in West Asia leading to shortages of crude oil and its derivates across the world, Varun Beverages Ltd. Monday said it has sufficient packaging material stockpiles including polyethylene terephthalate, a key raw material for packaging beverages. 

"In our international markets, the effect (of West Asia war) will practically be zero because we are well stocked till even not this quarter but the next quarter also. So, we normally carry six months inventory in international operations," Ravi Jaipuria, chairman at Varun Beverages, told investors in a post-earnings call. 

While the company is maintaining sufficient packaging materials and stockpiles, the inventory in India is also sufficient for the June quarter, he said adding that the inflation in packaging costs in global operations is not a concern for the company at least in the next six months. However, in India, the company may start to feel the pinch of mounting packaging costs September quarter onwards if crude prices continue to be high and its availability impacted. 

"But for the next quarter, it will have some effect (in India). But we are covering that by reducing our discounts and becoming more efficient, which is already starting to show, and cutting our costs wherever we can," Jaipuria said. 

The consumer goods industry is currently faced with shortages of packaging material as crude supplies are disrupted following the blockade of the Strait of Hormuz by the US and Iran. Nearly all consumer goods companies are currently concerned with mounting packaging costs. Polyethylene terephthalate – a key crude derivate, is used to package various consumer products and is widely used in the aerated beverages industry. Any disruption in production and supplies of polyethylene terephthalate is bound to elevate costs for the consumer goods industry. 

Asked if Varun Beverages may increase prices once its packaging materials inventory in India starts extinguishing to keep pace with cost pressures, Jaipuria said that the company may opt to lower the discounts it offers to its sales channels. Usually, a company can either increase its retail prices for consumers or lower the discounts offered to sales channels to maintain margins under cost pressures. 

Jaipuria said that Varun Beverages is looking at adding 500,000 more retail outlets in the current year, compared with its usual streak of adding 300,000-4000,000 outlets every year. The company follows calendar year as its financial year.  

He said that the company remains bullish on consumer demand in the country. This year, a good start to the summer made Jaipuria bullish on growth for the June quarter. Usually, cold and chilled beverage sales go up when the mercury rises. 

Monday, shares of Varun Beverages closed 5.8% higher at INR 518.85 on the National Stock Exchange.  End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Akul Nishant Akhoury

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