About
Varun Beverages Ltd
Varun Beverages Ltd, part of the RJ Corp group, a diversified business conglomerate with interests in beverages, quick-service restaurants, dairy and healthcare, is the second largest franchisee in the world (outside US) of carbonated soft drinks ('CSDs') and non-carbonated beverages ('NCBs') sold under trademarks owned by PepsiCo. The company produces and distributes a wide range of CSDs, as well as a large selection of NCBs, including packaged drinking water.
The Company has presence in 27 States and 7 Union Territories in India and 5 other countries across the world viz. Nepal, Sri Lanka, Morocco, Zambia & Zimbabwe. Further, It is is having 37 manufacturing facilities, of which 31 are in India and 6 in International Geographies with more than 2,500 owned vehicles, more than 2,000 primary distributors and more than 100 depots.
PepsiCo CSD brands produced and sold by the company include Pepsi, Diet Pepsi, Seven-Up, Mirinda Orange, Mirinda Lemon, Mountain Dew, Seven-Up Nimbooz Masala Soda, Evervess Soda, Sting and Gatorade. PepsiCo NCB brands produced and sold by the company include Tropicana (100%, Essentials & Delight), Tropicana Slice, Tropicana Frutz, Seven-Up Nimbooz and Quaker Oat Milk as well as packaged drinking water under the brand Aquafina. In addition, the company has also been granted the franchise for Ole brand of PepsiCo products in Sri Lanka.
The company has been associated with PepsiCo since the 1990s and over two and half decades consolidated its business association with PepsiCo, increasing the number of PepsiCo licensed territories and sub-territories covered by the company, producing and distributing a wider range of PepsiCo beverages, introducing various SKUs in the company's portfolio, and expanding the company's distribution network. As of March 2018, the company has been granted franchises for various PepsiCo products spread across 21 States and two Union Territories in India. The company's share of PepsiCo beverages volume sales ,based on sales to end customers, increased from 26.46% in Fiscal 2011 to ~51% in Fiscal 2018. Although, India is the company's largest market, the company has also been granted the franchise for various PepsiCo products for the territories of Nepal, Sri Lanka, Morocco, Zambia and Zimbabwe.
As of March 2018, the company has 20 manufacturing plants in India and five production facilities in the international geographies (one each in Nepal, Sri Lanka, Morocco, Zambia and Zimbabwe). In addition, the company has set up backward integration facilities for production of preforms, crowns, corrugated boxes, plastic crates and shrink-wrap films in certain of the company's production facilities to ensure operational efficiencies and quality standards.
The company's Promoter and Chairman Mr. Ravi Kant Jaipuria has an established reputation as an entrepreneur and business leader and is the only Indian to receive PepsiCo's International Bottler of the Year award, which was awarded in 1997.
The company was incorporated as Varun Beverages Limited on 16 June 1995 at New Delhi as a public limited company under the Companies Act, 1956. The company obtained a certificate of commencement of business on 4 July 1995. The company started its operations at Jaipur in 1996. In 1999, the company started operations at Alwar, Jodhpur and Kosi.
Devyani Beverages Limited was merged with Varun Beverages pursuant to the order of High Court of Delhi dated 6 October 2004. Varun Beverages (International) Limited was merged with Varun Beverages pursuant to the order of High Court of Delhi dated 12 March 2013. In 2013, Varun Beverages acquired the business of manufacturing and marketing of soft drink beverages and syrup mix in Delhi, India.
In 2015, through a business transfer agreement Varun Beverages acquired PepsiCo India's business of manufacturing, marketing, selling and distributing soft drink beverages and syrup mix in the Indian states of Uttar Pradesh (excluding certain territories), Uttarakhand, Himachal Pradesh, Haryana (excluding certain territories) and the Union Territory of Chandigarh. During the year, the company through a business transfer agreement acquired PepsiCo India's business of manufacturing, marketing, selling and distributing soft drink beverages and syrup mix in Bazpur, Jainpur, Satharia and Panipat. During the year, the company acquired the business of selling and distribution of soft drinks beverages and syrup mix in one district undertaking situated in Punjab.
In 2016, Varun Beverages acquired entire shareholding of Arctic International Private Limited in Varun Beverages Mozambique, Limitada. During the year, the company acquired entire shareholding of Arctic International Private Limited in Varun Beverages (Zambia) Limited. During the year, Varun Beverages acquired 85% shareholding of Varun Beverages (Zimbabwe) (Private) Limited (VBZPL).
Varun Beverages came out with an initial public offer (IPO) during the period from 26 October 2016 to 28 October 2016. The IPO was a combination of fresh issue of 1.5 crore shares and offer for sale of 1 crore shares from the promoters. The IPO was priced at Rs 445 per share. The company's shares were listed on the bourses on 8 November 2016.
On 23 February 2017, Varun Beverages announced that it has increased its stake in its Zambia subsidiary, Varun Beverages (Zambia) Limited, to 90% from 60%. VBL has been successfully running the Zambia operations since its acquisition in 2016. The increase in stake reflects the company's confidence in the future growth prospects of the subsidiary and will be an effective catalyst to drive further business growth in a fast-growing emerging market.
On 9 March 2017, Varun Beverages Limited (VBL) announced that it has divested 41% stake in its Mozambique subsidiary, Varun Beverages Mozambique Limitada. The divestment of the stake is in view of limited opportunity to scale-up operations which would have enabled the company to turnaround the loss making subsidiary. VBL continues to hold a residual stake of 10% in the unit.
On 4 May 2017, Varun Beverages announced that the company has set up a new unit for manufacturing of Pepsi range of products at District Hardoi, Uttar Pradesh and the commercial production/operation has started with effect from 3 May2017.
On 28 September 2017, Varun Beverages announced that the company has concluded the acquisition of PepsiCo India's previously franchised territories in the state of Odisha and parts of Madhya Pradesh along with two manufacturing units at Bargarh and Bhopal (Mandideep).
On 4 January 2018, Varun Beverages announced that it has further deepened its relationship with PepsiCo by entering into a strategic partnership for the larger Tropicana portfolio along with Gatorade and Quaker Value-Added Dairy in territories across North and East India. This is part of VBL's strategy to expand its product portfolio through its valued relationship with PepsiCo.
On 11 January 2018, Varun Beverages announced that it has concluded the acquisition of PepsiCo India's previously franchised rights for the state of Chhattisgarh. The Board of Directors of Varun Beverages at its meeting held on 17 January 2018 considered and approved to acquire franchisee rights for PepsiCo India's previously franchised sub-territory in the State of Bihar. Varun Beverages' subsidiary Varun Beverages (Zimbabwe) (Private) started Commercial Production at a Greenfield facility for Pepsico's products with effect from 16 February 2018.
On 23 March 2018, Varun Beverages announced that it has concluded the acquisition of PepsiCo India's previously franchised sub territory in the State of Jharkhand along with one manufacturing unit at Jamshedpur. The company is now a franchisee for PepsiCo products across 21 States and 2 Union Territories of India.
On 5 April 2018, Varun Beverages announced its plans to set-up a greenfield production facility (subject to receipt of necessary approvals) to create in-house production capacity at Pathankot district of Punjab for Tropicana fruit juices, Quaker Oats Milk based Beverages and Gatorade. Spread over ~41 acres, it will be the first fully backward integrated facility in India to manufacture the complete range of above products including carbonated soft drinks (CSD) at a single location. The expansion is to take advantage of the growing demand of Juice Based beverages for health conscious consumers.
On 3 May 2018, Varun Beverages informed the stock exchanges that a new unit at Nawalparasi District in Napal, under Varun Beverages (Nepal) Private Limited, a wholly owned subsidiary of the company, started commercial production with effect from 2 May 2018.
The Board of Directors in their meeting held on February 18, 2019 approved, its intent to enter into a binding agreement with PepsiCo India Holdings Private Limited to acquire franchise rights in South and West regions o f India from PepsiCo for a national bottling, sales and distribution footprint in 7 States and 5 Union Territories.
In May 2019, the Company acquired franchise rights in South and West regions from PepsiCo for a national bottling, sales and distribution footprint in 7 States and 5 Union Territories of India. It acquired franchise rights in the states of Gujarat, Telangana, Kerala, Tamil Nadu and parts of Maharashtra, Karnataka, Andhra Pradesh and in Union Territories of Daman & Diu, Dadra & Nagar Haveli, Andaman & Nicobar Islands, and Lakshadweep and Puducherry, except Yanam. In February 2019, it acquired territorial rights from SMV Group for parts of Maharashtra (14 districts), Karnataka (13 districts) and Madhya Pradesh (3 districts). The Company acquired an additional 20% stake in Lunarmech Technologies Private Limited during the year, which makes and sells PET bottle caps and crown caps, increasing their shareholding to 55% of the effective equity share capital. Post-acquisition, Company holds 55% of the effective equity share capital of Lunarmech. Subsequently, Company acquired control of Angelica Technologies Private Limited by appointment of majority of Directors on the Board of Angelica. Post acquisition of control, both Angelica and Lunarmech (in which Angelica holds 74% equity share capital) became subsidiaries of the Company. Additionally, it acquired two production facilities, one at Dharwad, Karnataka for a total consideration of Rs. 747.25 million; and the second at Tirunelveli, Tamil Nadu for a total consideration of Rs. 200 million. Apart from these, it launched 3 new variants of ambient temperature value-added dairy beverages, Belgian Choco Shake, Cold Coffee and Mango Shake in 200ml PET bottle, with a 180-day shelf life during year 2019-20.
As of December 31, 2021, the Company had 31 state-of-the-art manufacturing facilities in India, and 6 globally.
During the year 2021, the Company incorporated a new company with the name Varun Beverages RDC SAS' in Democratic Republic of Congo (DRC) to initially import finished products like carbonated and non-carbonated beverages, distribute to test and establish the market before setting up a manufacturing facility locally. A new plant in Bihar was set up to improve market presence and gain a foothold in the territory. Apart from this, a new plant was set up for manufacturing of plastic preforms and plastic closures in Jammu & Kashmir.
During the year 2022, Company issued and allotted 216,516,540 Bonus Equity Shares in the proportion of 1:2 (i.e. one equity share for every two equity shares). As part of the aforesaid allotment, 38,418 Bonus Equity Shares representing fractional entitlement(s) of 76,836 eligible Members were consolidated and allotted to 'Varun Beverages Limited and the aforesaid 38,418 Equity Shares were sold by the Trust on June 23, 2022 & June 24, 2022 and the net sale proceeds of the same were distributed to the eligible Members.
During the year 2022, the Company commenced manufacturing carbonated soft drinks, juice-based drinks and packaged drinking water in Bihar; manufacturing plastic preforms and closures at plant in Jammu & Kashmir and established a business line for production of Kurkure Puffcorn for PepsiCo in Kosi, Uttar Pradesh.
Varun Beverages Ltd
Chairman Speech
Dear Stakeholders,
Varun Beverages considers sustainability to be of utmost importance; not just as a
crucial element to meet its regulatory requirements and propel business growth but also as
a significant contributor to safeguard the planet and life on it. Our ESG principles,
therefore, remain the guiding force behind the way we do business. We are proud to have
consistently met our ESG goals in the past few years and remain committed to forge
sustainable pathways for the future, in collaboration with our valued stakeholders.
Varun Jaipuria
Promoter, Executive Vice-Chairman and Whole-time Director
Sustainable action has never been more critical. Today, the need for embracing
sustainability transcends beyond - combating climate change and creating social equality -
to foster innovation, build trust and steer long-term profitability. In this evolving
business landscape, Varun Beverages, along with refreshing billions of consumers through
its ever-expanding portfolio of beverages, prioritizes environmental stewardship, social
responsibility and robust governance practices.
As a responsible business, we take significant initiatives to optimize resource
efficiency, reduce and manage waste and increase our share of renewable energy.
Together, these will help us meet our ESG Goals of optimizing carbon footprints,
promoting social equity, and adding more value to our employees, vendors, suppliers and
other stakeholders.
Grow Consistently. Sustain Constantly.
Growth and sustainability are mutually inclusive concepts at Varun Beverages; one
cannot happen without the other. In this context, our business strategy and growth
enablers are closely tied to our ESG priorities and its key pillars: Environmental
Protection, Social Capital, Human Capital Development, Business Model & Innovation,
and Leadership & Governance. Prioritizing the material aspects under each of these
pillars help us to consistently focus on most significant sustainability issues and create
long-term value for our stakeholders.
This report covers the sustainability initiatives taken and progress made in CY 2023 in
detail. Flipping through the pages will give you an insight on the processes initiated and
actions taken across environment, social and governance aspects of our ESG policy. It also
defines our plans for the future, establishing our ambitious goals to recycle plastic
waste by 2025, achieve water positivity as well as improve our renewable energy share by
2030.
Demonstrating
Environmental Stewardship
Refreshing billions of consumers comes with the responsibility to ensure that we leave
minimum environmental footprints as we do so. As a responsible business, we take
significant initiatives to optimize resource efficiency, reduce and manage waste and
increase our share of renewable energy.
Reduce, reuse and recycle served as a key mantra across the value chain in CY 2023.
Continued engagement with GEM Enviro Management Pvt. Ltd. built up awareness about waste
management and pushed waste collection. In addition, alliance with Deutsch Quality Systems
(India) Private Limited enabled measurement and improvement in the Company's carbon
footprint and water footprint assurance.
Achieving water positivity through focused initiatives for water stewardship, including
pond adoption, maintenance and rejuvenation, continued to remain a key priority during the
year. This resulted in positive water recharge and reaped multiple benefits for the farmer
community. Emphasis on responsible sourcing of raw materials from suppliers who follow
PepsiCo's Global Supplier Code of Conduct also helped us to achieve desirable
environmental and social impact.
Upholding Social Responsibility
Our deep-rooted commitment and care for our employees, contractors, and consumers
reflects through a bunch of health, safety and quality measures that we took throughout
the year. An ESG-linked incentive framework was implemented to steer our employees to
follow sustainable practices and contribute to the Company's ESG goals. Consistent
efforts towards building a safe, nurturing and inclusive work-environment supported by
continuous training and development resulted in a culture of diversity, performance and
growth. Equal efforts were placed towards boosting employee health and wellness.
Safety is paramount to us. DuPont Safety Solutions was engaged for implementing best
practices in safety at all of our manufacturing plants in India. A robust safety strategy
supported by an incident management system, continuous trainings, and strict vigilance has
also been put in place to drive zero incidents at workplace. An Employee Passport and
Contractor Safety
Management System further tracks and ensures contractor safety.
Manufacturing and distributing safe and high-quality products forms the core of our
social responsibility. Year after year, we have successfully achieved this goal with our
commitment to responsible and ethical sourcing and manufacturing practices; conformation
with global quality standards; transparent product labelling; and sustainable marketing
strategy. Persistent focus on aligning with the changing needs of our consumers have also
inspired us to provide an assortment of product mix with healthier and low sugar beverage
options for refreshment.
Robust Governance Practices
Our robust governance framework and well-structured policies and practices serve an
instrumental role in driving ethical conduct, accountability and transparency within the
system and all its stakeholders. We take pride in expanding the reach of our rigorous
policies to include contractors and suppliers, prioritizing an ESG-centric approach. A
crisis management team has also been formed and is regularly trained to ensure business
continuity in case of an adversity. Our commitment to corporate governance has garnered
many awards and accolades.
Our sustainability agenda includes uplifting the underprivileged and beneficiaries from
economically weaker sections through initiatives that provide them better access to
education, health and livelihoods. In the education sphere, we collaborated with Shiksha
Kendra School to provide free education and related resources to 32,500+ underprivileged
students.
Ten AARU Clinics in India and one in Nepal were set-up near our manufacturing sites
with the objective of providing free healthcare services to marginalized communities
Our robust governance framework and well-structured policies and practices serve an
instrumental role in driving ethical conduct, accountability and transparency within the
system and all its stakeholders.
residing in the rural areas. 110,000+ beneficiaries received free medical assistance,
medicines and underwent diagnostic tests under this initiative. Pravah, another initiative
by VBL, empowered the unemployed youth through skill development and provision of
sustainable livelihood opportunities. 17,000+ youth were trained under this initiative.
Paving the way for a Sustainable Future
For the world to become a better place, each of us needs to take consistent sustainable
action. Our steadfast commitment to sustainability in the recent years is demonstrated
through our initiatives and their significant impact. Through an indomitable spirit and
continuous innovations, we aspire to steer our ESG journey further and inspire several
others to pave the way towards a brighter, more sustainable future.
Together, let us make responsible decisions and take conscious action to protect our
environment and create equal and consistent opportunities for the communities we live and
operate in.
Warm Regards,
Varun Jaipuria
Promoter, Executive Vice-Chairman and Whole-time Director
Varun Beverages Ltd
Company History
Varun Beverages Ltd, part of the RJ Corp group, a diversified business conglomerate with interests in beverages, quick-service restaurants, dairy and healthcare, is the second largest franchisee in the world (outside US) of carbonated soft drinks ('CSDs') and non-carbonated beverages ('NCBs') sold under trademarks owned by PepsiCo. The company produces and distributes a wide range of CSDs, as well as a large selection of NCBs, including packaged drinking water.
The Company has presence in 27 States and 7 Union Territories in India and 5 other countries across the world viz. Nepal, Sri Lanka, Morocco, Zambia & Zimbabwe. Further, It is is having 37 manufacturing facilities, of which 31 are in India and 6 in International Geographies with more than 2,500 owned vehicles, more than 2,000 primary distributors and more than 100 depots.
PepsiCo CSD brands produced and sold by the company include Pepsi, Diet Pepsi, Seven-Up, Mirinda Orange, Mirinda Lemon, Mountain Dew, Seven-Up Nimbooz Masala Soda, Evervess Soda, Sting and Gatorade. PepsiCo NCB brands produced and sold by the company include Tropicana (100%, Essentials & Delight), Tropicana Slice, Tropicana Frutz, Seven-Up Nimbooz and Quaker Oat Milk as well as packaged drinking water under the brand Aquafina. In addition, the company has also been granted the franchise for Ole brand of PepsiCo products in Sri Lanka.
The company has been associated with PepsiCo since the 1990s and over two and half decades consolidated its business association with PepsiCo, increasing the number of PepsiCo licensed territories and sub-territories covered by the company, producing and distributing a wider range of PepsiCo beverages, introducing various SKUs in the company's portfolio, and expanding the company's distribution network. As of March 2018, the company has been granted franchises for various PepsiCo products spread across 21 States and two Union Territories in India. The company's share of PepsiCo beverages volume sales ,based on sales to end customers, increased from 26.46% in Fiscal 2011 to ~51% in Fiscal 2018. Although, India is the company's largest market, the company has also been granted the franchise for various PepsiCo products for the territories of Nepal, Sri Lanka, Morocco, Zambia and Zimbabwe.
As of March 2018, the company has 20 manufacturing plants in India and five production facilities in the international geographies (one each in Nepal, Sri Lanka, Morocco, Zambia and Zimbabwe). In addition, the company has set up backward integration facilities for production of preforms, crowns, corrugated boxes, plastic crates and shrink-wrap films in certain of the company's production facilities to ensure operational efficiencies and quality standards.
The company's Promoter and Chairman Mr. Ravi Kant Jaipuria has an established reputation as an entrepreneur and business leader and is the only Indian to receive PepsiCo's International Bottler of the Year award, which was awarded in 1997.
The company was incorporated as Varun Beverages Limited on 16 June 1995 at New Delhi as a public limited company under the Companies Act, 1956. The company obtained a certificate of commencement of business on 4 July 1995. The company started its operations at Jaipur in 1996. In 1999, the company started operations at Alwar, Jodhpur and Kosi.
Devyani Beverages Limited was merged with Varun Beverages pursuant to the order of High Court of Delhi dated 6 October 2004. Varun Beverages (International) Limited was merged with Varun Beverages pursuant to the order of High Court of Delhi dated 12 March 2013. In 2013, Varun Beverages acquired the business of manufacturing and marketing of soft drink beverages and syrup mix in Delhi, India.
In 2015, through a business transfer agreement Varun Beverages acquired PepsiCo India's business of manufacturing, marketing, selling and distributing soft drink beverages and syrup mix in the Indian states of Uttar Pradesh (excluding certain territories), Uttarakhand, Himachal Pradesh, Haryana (excluding certain territories) and the Union Territory of Chandigarh. During the year, the company through a business transfer agreement acquired PepsiCo India's business of manufacturing, marketing, selling and distributing soft drink beverages and syrup mix in Bazpur, Jainpur, Satharia and Panipat. During the year, the company acquired the business of selling and distribution of soft drinks beverages and syrup mix in one district undertaking situated in Punjab.
In 2016, Varun Beverages acquired entire shareholding of Arctic International Private Limited in Varun Beverages Mozambique, Limitada. During the year, the company acquired entire shareholding of Arctic International Private Limited in Varun Beverages (Zambia) Limited. During the year, Varun Beverages acquired 85% shareholding of Varun Beverages (Zimbabwe) (Private) Limited (VBZPL).
Varun Beverages came out with an initial public offer (IPO) during the period from 26 October 2016 to 28 October 2016. The IPO was a combination of fresh issue of 1.5 crore shares and offer for sale of 1 crore shares from the promoters. The IPO was priced at Rs 445 per share. The company's shares were listed on the bourses on 8 November 2016.
On 23 February 2017, Varun Beverages announced that it has increased its stake in its Zambia subsidiary, Varun Beverages (Zambia) Limited, to 90% from 60%. VBL has been successfully running the Zambia operations since its acquisition in 2016. The increase in stake reflects the company's confidence in the future growth prospects of the subsidiary and will be an effective catalyst to drive further business growth in a fast-growing emerging market.
On 9 March 2017, Varun Beverages Limited (VBL) announced that it has divested 41% stake in its Mozambique subsidiary, Varun Beverages Mozambique Limitada. The divestment of the stake is in view of limited opportunity to scale-up operations which would have enabled the company to turnaround the loss making subsidiary. VBL continues to hold a residual stake of 10% in the unit.
On 4 May 2017, Varun Beverages announced that the company has set up a new unit for manufacturing of Pepsi range of products at District Hardoi, Uttar Pradesh and the commercial production/operation has started with effect from 3 May2017.
On 28 September 2017, Varun Beverages announced that the company has concluded the acquisition of PepsiCo India's previously franchised territories in the state of Odisha and parts of Madhya Pradesh along with two manufacturing units at Bargarh and Bhopal (Mandideep).
On 4 January 2018, Varun Beverages announced that it has further deepened its relationship with PepsiCo by entering into a strategic partnership for the larger Tropicana portfolio along with Gatorade and Quaker Value-Added Dairy in territories across North and East India. This is part of VBL's strategy to expand its product portfolio through its valued relationship with PepsiCo.
On 11 January 2018, Varun Beverages announced that it has concluded the acquisition of PepsiCo India's previously franchised rights for the state of Chhattisgarh. The Board of Directors of Varun Beverages at its meeting held on 17 January 2018 considered and approved to acquire franchisee rights for PepsiCo India's previously franchised sub-territory in the State of Bihar. Varun Beverages' subsidiary Varun Beverages (Zimbabwe) (Private) started Commercial Production at a Greenfield facility for Pepsico's products with effect from 16 February 2018.
On 23 March 2018, Varun Beverages announced that it has concluded the acquisition of PepsiCo India's previously franchised sub territory in the State of Jharkhand along with one manufacturing unit at Jamshedpur. The company is now a franchisee for PepsiCo products across 21 States and 2 Union Territories of India.
On 5 April 2018, Varun Beverages announced its plans to set-up a greenfield production facility (subject to receipt of necessary approvals) to create in-house production capacity at Pathankot district of Punjab for Tropicana fruit juices, Quaker Oats Milk based Beverages and Gatorade. Spread over ~41 acres, it will be the first fully backward integrated facility in India to manufacture the complete range of above products including carbonated soft drinks (CSD) at a single location. The expansion is to take advantage of the growing demand of Juice Based beverages for health conscious consumers.
On 3 May 2018, Varun Beverages informed the stock exchanges that a new unit at Nawalparasi District in Napal, under Varun Beverages (Nepal) Private Limited, a wholly owned subsidiary of the company, started commercial production with effect from 2 May 2018.
The Board of Directors in their meeting held on February 18, 2019 approved, its intent to enter into a binding agreement with PepsiCo India Holdings Private Limited to acquire franchise rights in South and West regions o f India from PepsiCo for a national bottling, sales and distribution footprint in 7 States and 5 Union Territories.
In May 2019, the Company acquired franchise rights in South and West regions from PepsiCo for a national bottling, sales and distribution footprint in 7 States and 5 Union Territories of India. It acquired franchise rights in the states of Gujarat, Telangana, Kerala, Tamil Nadu and parts of Maharashtra, Karnataka, Andhra Pradesh and in Union Territories of Daman & Diu, Dadra & Nagar Haveli, Andaman & Nicobar Islands, and Lakshadweep and Puducherry, except Yanam. In February 2019, it acquired territorial rights from SMV Group for parts of Maharashtra (14 districts), Karnataka (13 districts) and Madhya Pradesh (3 districts). The Company acquired an additional 20% stake in Lunarmech Technologies Private Limited during the year, which makes and sells PET bottle caps and crown caps, increasing their shareholding to 55% of the effective equity share capital. Post-acquisition, Company holds 55% of the effective equity share capital of Lunarmech. Subsequently, Company acquired control of Angelica Technologies Private Limited by appointment of majority of Directors on the Board of Angelica. Post acquisition of control, both Angelica and Lunarmech (in which Angelica holds 74% equity share capital) became subsidiaries of the Company. Additionally, it acquired two production facilities, one at Dharwad, Karnataka for a total consideration of Rs. 747.25 million; and the second at Tirunelveli, Tamil Nadu for a total consideration of Rs. 200 million. Apart from these, it launched 3 new variants of ambient temperature value-added dairy beverages, Belgian Choco Shake, Cold Coffee and Mango Shake in 200ml PET bottle, with a 180-day shelf life during year 2019-20.
As of December 31, 2021, the Company had 31 state-of-the-art manufacturing facilities in India, and 6 globally.
During the year 2021, the Company incorporated a new company with the name Varun Beverages RDC SAS' in Democratic Republic of Congo (DRC) to initially import finished products like carbonated and non-carbonated beverages, distribute to test and establish the market before setting up a manufacturing facility locally. A new plant in Bihar was set up to improve market presence and gain a foothold in the territory. Apart from this, a new plant was set up for manufacturing of plastic preforms and plastic closures in Jammu & Kashmir.
During the year 2022, Company issued and allotted 216,516,540 Bonus Equity Shares in the proportion of 1:2 (i.e. one equity share for every two equity shares). As part of the aforesaid allotment, 38,418 Bonus Equity Shares representing fractional entitlement(s) of 76,836 eligible Members were consolidated and allotted to 'Varun Beverages Limited and the aforesaid 38,418 Equity Shares were sold by the Trust on June 23, 2022 & June 24, 2022 and the net sale proceeds of the same were distributed to the eligible Members.
During the year 2022, the Company commenced manufacturing carbonated soft drinks, juice-based drinks and packaged drinking water in Bihar; manufacturing plastic preforms and closures at plant in Jammu & Kashmir and established a business line for production of Kurkure Puffcorn for PepsiCo in Kosi, Uttar Pradesh.
Varun Beverages Ltd
Directors Reports
Dear Members,
Your Directors have pleasure in presenting the 29th (Twenty Ninth) Annual
Report on the business and operations of your Company along with the Audited Financial
Statements for the Financial Year ended December 31, 2023.
Financial Performance
The financial performance of your Company for the Financial Year ended December 31,
2023 is summarized below:
(` in Million)
| Particulars |
Standalone
|
Consolidated
|
|
Financial Year ended
December 31, 2023 |
Financial Year ended
December 31, 2022 |
Financial Year ended
December 31, 2023 |
Financial Year ended
December 31, 2022 |
| Total Revenue |
127,789.68 |
107,395.82 |
164,004.22 |
134,294.07 |
| Total Expenses |
104,108.05 |
90,550.80 |
136,605.83 |
114,057.64 |
| Profit before tax after exceptional items |
23,681.63 |
16,845.02 |
27,393.60 |
20,236.37 |
| Less: Tax Expenses |
5,930.37 |
4,143.03 |
6,375.47 |
4,735.23 |
| Profit after tax |
17,751.26 |
12,701.99 |
20,559.22* |
14,974.33* |
| Balance brought forward from last year |
25,101.68 |
13,942.96 |
27,398.84 |
13,967.42 |
| Balance carried over to Balance Sheet |
40,558.69 |
25,101.68 |
45,663.50 |
27,398.84 |
| General Reserve |
444.26 |
444.26 |
444.26 |
444.26 |
| Other Reserves |
23,259.02 |
23,132.57 |
16,761.15 |
16,685.20 |
| Reserves & Surplus carried to Balance Sheet |
64,261.97 |
48,678.51 |
62,868.91 |
44,528.30 |
*After adjustment on account of non-controlling interest.
Consolidated Financial Statements
The Consolidated Financial Statements of your Company for the Financial
Year 2023 are prepared in compliance with the applicable provisions of the Companies Act,
2013 (‘the Act'), Indian Accounting Standards (‘Ind AS') and the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 [‘SEBI (LODR) Regulations'] which shall also be provided to
the Members in their forthcoming Annual General Meeting (‘AGM').
State of the Company's Affairs
Your Company has presence in 27 States and 7 Union Territories in India
and 5 other countries across the world (viz. Nepal, Sri Lanka, Morocco, Zambia &
Zimbabwe). As of December 31, 2023, the Company has 40 state-of-the-art manufacturing
facilities (34 in India and
6 in International Geographies) with more than 2,500 owned vehicles,
more than 2,400 primary distributors and more than 120 depots. The Company continues to
create long-term value through different facets of its
business and improve its presence, product mix and utilisation levels.
With an increasing penetration on the back of a robust distribution network and
diversifying product portfolio, the Company has created a sustainable operating efficiency
at its manufacturing facilities.
During the year under review, the Board of Directors in their meeting
held on December 19, 2023 approved to acquire 100% stake in the business conducted by The
Beverage Company (Proprietary) Limited, South Africa along-with its wholly-owned
subsidiaries ("Bevco") with an option to accept minority co-investment from
large equity fund subject to regulatory and other approvals (if any) including but not
limited to PepsiCo Inc. and Competition Commission South Africa. Bevco is engaged in the
business of manufacturing and distribution of licensed (PepsiCo Inc.)/own-branded
non-alcoholic beverages in South Africa. Bevco has franchise rights from PepsiCo Inc. in
South Africa, Lesotho and Eswatini. Additionally, it possesses distribution rights for
Namibia and Botswana.
Deposits
Your Company has not accepted any deposits during the year under
review falling within the ambit of Section 73 of the Act and the Companies (Acceptance of
Deposits) Rules, 2014.
Transfer to General Reserve
Your Company has not transferred any amount to General Reserve for
the Financial Year 2023.
Change in the Nature of Business, if any
During the year under review, there was no change in the nature of
business of the Company.
Dividend Distribution Policy
The Board of Directors of the Company in their meeting held on
August 9, 2017 approved and adopted a Policy on Distribution of Dividend to comply with
Regulation 43A of SEBI (LODR) Regulations and the same is uploaded on website of the
Company at https://varunbeverages.com/
wp-content/uploads/2023/03/10-Dividend-Distribution- Policy.pdf
Dividend
During the year under review, the Board of Directors in their
meeting held on August 3, 2023 declared an interim dividend of ` 1.25 per Equity Share
(face value of ` 5/- per Equity Share) to the eligible equity shareholders of the Company.
Further, the Board of Directors have also recommended a final dividend of ` 1.25 per
Equity Share (face value of ` 5/- per Equity Share) for the Financial Year 2023. Total
cash outflow for dividend payout would be ~` 3,248.07 million for the Financial Year 2023.
Your Company has transferred the unpaid/unclaimed dividend (interim and
final) to the Unclaimed Dividend Accounts of the respective financial years and the
details of the same are uploaded on website of the Company at
https://varunbeverages.com/corporate-governance/
Acquisition Guidelines
Your Company applies stringent strategic and financial criteria to
any potential acquisition or partnership and to enhance transparency, the Board of
Directors of the Company have approved and adopted Acquisition Guidelines for
Company's M&A activities for viable acquisitions and the same is uploaded on
website of the Company at https://varunbeverages.com/wp-content/
uploads/2023/03/9-VBL-Guidelines-for-Acquisition-in- India.pdf
Sub-Division/Split of Equity Shares
During the year under review, pursuant to the approval of Members
through Postal Ballot on June 2, 2023,
the Issued, Subscribed and Paid-up Equity Share Capital existing on the
Record Date (i.e. June 15, 2023) was sub-divided/split from 1(One) Equity Share having
face value of ` 10/- each fully paid-up, into 2(Two) Equity Shares having face value of `
5/- each fully paid-up.
Share Capital
Pursuant to the approval of Members through Postal Ballot on June
2, 2023 for sub-division/split of Equity Shares of the Company from 1(One) Equity Share
having face value of ` 10/- each fully paid-up, into 2(Two) Equity Shares having face
value of ` 5/- each fully paid-up, the Authorized Share Capital of the Company stood sub-
divided/split from ` 10,000,000,000/- (Rupees Ten Billion only) divided into 1,000,000,000
(One Billion) Equity Shares of face value of ` 10/- (Rupees Ten only) each to
` 10,000,000,000/- (Rupees Ten Billion only) divided into
2,000,000,000 (Two Billion) Equity Shares of face value of ` 5/-
(Rupees Five only) each.
During the year under review, the Issued, Subscribed and Paid-up Equity
Share Capital of your Company was increased/changed from ` 6,495,496,200/- (Rupees Six
Billion Four Hundred Ninety Five Million Four Hundred Ninety Six Thousand and Two Hundred
only) divided into 649,549,620 (Six Hundred Forty Nine Million Five Hundred Forty Nine
Thousand and Six Hundred Twenty) Equity Shares of face value of ` 10/- (Rupees Ten only)
each to ` 6,496,074,880 (Rupees Six Billion Four Hundred Ninety Six Million Seventy Four
Thousand and Eight Hundred Eighty only) divided into 1,299,214,976 (One Billion Two
Hundred Ninety Nine Million Two Hundred Fourteen Thousand and Nine Hundred Seventy Six)
Equity Shares of face value of ` 5/- (Rupees Five only) each due to sub-division/split of
Equity Shares of the Company from 1(One) Equity Share having face value of ` 10/- each
fully paid-up, into 2 (Two) Equity Shares having face value of ` 5/- each fully paid-up,
and allotment of 115,736 (One Hundred Fifteen Thousand and Seven Hundred Thirty Six)
Equity Shares of the Company in aggregate upon exercise of stock options vested under
Employees Stock Option Scheme 2016.
Employees Stock Option Scheme
Your Company has Employees Stock Option Scheme 2016 (‘ESOP
Scheme 2016') i.e. in compliance with SEBI (Share Based Employee Benefits and Sweat
Equity) Regulations, 2021, as amended from time to time (‘SEBI ESOP
Regulations').
Certificate from Secretarial Auditors of the Company that ESOP Scheme
2016 has been implemented in accordance with the SEBI ESOP Regulations and the
resolution(s) passed by the Members of the Company will be uploaded on website viz.
https://varunbeverages.com/agm/ for inspection by Members of the Company.
The statutory disclosures as mandated under the Act and SEBI ESOP
Regulations are available on website of the Company at https://varunbeverages.com/agm/
Credit Rating
During the year under review, your Company's credit ratings by
CRISIL is as below:
| Long Term Rating |
CRISIL AA+/Stable (Re-affirmed) |
| Short Term Rating |
CRISIL A1+ (Re-affirmed) |
Related Party Transactions
To comply with the provisions of Sections 177 and 188 of the Act and
Rules made thereunder read with Regulation
23 of SEBI (LODR) Regulations, your Company took necessary prior
approval of the Audit, Risk Management and Ethics Committee before entering into related
party transactions. All contracts/arrangements/transactions entered into by the Company
during the Financial Year 2023 with related parties, as defined under the Act and SEBI
(LODR) Regulations, were in the ordinary course of business and on arm's length
basis.
During the year under review, your Company and/or its subsidiaries have
not entered into any contract/ arrangement/transaction with related parties which could be
considered material in accordance with the Policy of the Company on Related Party
Transactions.
None of the transactions with any of the related parties were in
conflict with the interest of the Company rather, these were synchronized and synergized
with the Company's operations. Attention of Members is drawn to the disclosure of
transactions with the related parties set out in Note No. 42 of the Standalone Financial
Statements forming part of the Annual Report.
Your Company has framed a Policy on Related Party Transactions in
accordance with the Act and SEBI (LODR) Regulations. The Policy intends to ensure that
proper reporting, approval and disclosure processes are in place for all transactions
between the Company and its related parties. The policy is uploaded on website of the
Company at https://varunbeverages.com/wp-
content/uploads/2023/03/16-Policy-on-Related-Party- Transactions.pdf
Since all transactions which were entered into during the Financial
Year 2023 were on arm's length basis and in the ordinary course of business and there
was no material related party transaction entered by the Company during the Financial Year
2023 as per Policy on Related Party Transactions, hence no detail is required to be
provided in Form AOC-2 prescribed under Clause (h) of Sub-section (3) of Section 134 of
the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.
Particulars of Loans, Guarantees or Investments Details of Loans,
Guarantees or Investments covered under the provisions of Section 186 of the Act are given
in
the Notes to the Standalone Financial Statements.
Subsidiaries, Associates and Joint Ventures Your Company has following
subsidiaries, associates and joint venture:
Subsidiaries
- Varun Beverages (Nepal) Private Limited;
- Varun Beverages Lanka (Private) Limited;
- Ole Springs Bottlers (Private) Limited (step-down subsidiary);
- Varun Beverages Morocco SA;
- Varun Beverages (Zambia) Limited;
- Varun Beverages (Zimbabwe) (Private) Limited;
- Varun Beverages International DMCC;
- Varun Beverages South Africa (Pty) Ltd. (w.e.f. 23.05.2023);
- VBL Mozambique, SA (w.e.f. 21.11.2023); and
- Lunarmech Technologies Private Limited
Associates
- Clean Max Tav Private Limited; and
- Huoban Energy 7 Private Limited (w.e.f. 09.05.2023)
Joint Venture
- IDVB Recycling Operations Private Limited
To comply with the provisions of Section 129 of the Act, a separate
statement containing salient features of Financial Statements of Subsidiaries, Associates
and Joint Venture of your Company (including their performance and financial position) in
prescribed Form AOC-1 forms part of Consolidated Financial Statements and therefore not
repeated here to avoid duplication. Further, contribution of Subsidiaries, Associates and
Joint Venture to the overall performance of your Company is outlined in Note No. 57 of the
Consolidated Financial Statements.
Financial Statements of the aforesaid Subsidiaries, Associates and
Joint Venture companies are kept open for inspection by the Members at the Registered
Office of your Company on all days except Saturday, Sunday and Public Holiday up to the
date of AGM i.e. April 3, 2024 between 11:00 a.m. to 5:00 p.m. as required under Section
136 of the Act. Any Member desirous of obtaining a copy of the said
Financial Statements may write to the Company at its Registered Office or Corporate
Office. The Financial Statements including the Consolidated Financial Statements and all
other documents required to be attached with this Report have been uploaded on website of
the Company at https://varunbeverages.com/ annual-reports/
To comply with the provisions of Regulation 16(c) of SEBI (LODR)
Regulations, the Board of Directors of the Company have approved and adopted a Policy for
determination of Material Subsidiary and Governance of Subsidiaries and as on December 31,
2023, none of the subsidiary was a material subsidiary of the Company in terms of the said
Policy. Policy for determination of Material Subsidiary and Governance of Subsidiaries is
uploaded on website of the Company at https://varunbeverages.com/
wp-content/uploads/2023/03/17-3.-Policy-on-Material- Subsidiary-VBL.pdf
Directors and Key Managerial Personnel
Directors
To comply with the provisions of Section 152 of the Act and in
terms of the Articles of Association of the Company, Mr. Raj Gandhi (DIN: 00003649),
Whole-time Director is liable to retire by rotation at the ensuing AGM and being eligible,
seeks re-appointment. The Board of Directors, on the recommendation of Nomination and
Remuneration Committee (‘NRC'), recommended his re-appointment for consideration
by the Members at the ensuing AGM.
As recommended by NRC, the Board of Directors in their meeting held on
February 5, 2024 approved the re-appointment of Mr. Varun Jaipuria (DIN: 02465412) and Mr.
Raj Gandhi (DIN: 00003649) w.e.f. November 1, 2024 and Mr. Rajinder Jeet Singh Bagga (DIN:
08440479)
w.e.f. May 2, 2024 as Whole-time Directors for a further period of upto
5 (Five) years, liable to retire by rotation, subject to the approval of Members at the
ensuing AGM of the Company. The NRC and Board of Directors are of the view that their
skills, background and experience are aligned to the role and capabilities identified by
NRC and that they are eligible for re-appointment as Whole-time Directors of the Company.
Further, the above-mentioned Directors have affirmed that they are not debarred from
holding the office of Director by virtue of any order of SEBI or any other such Authority.
Further, the appointment of Mr. Abhiram Seth (DIN: 00176144) and Mr.
Anil Kumar Sondhi (DIN: 00696535) as Independent Directors, not liable to retire by
rotation, to hold office for a term of upto 5 (Five) consecutive years w.e.f. May 2, 2023
were approved by
the Shareholders of your Company through Postal Ballot on June 2, 2023.
Company has received declarations from all the Independent Directors of
the Company confirming that they meet the criteria of independence as prescribed both
under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI (LODR) Regulations and
are in compliance with Rule 6 of the Companies (Appointment and Qualification of
Directors) Rules, 2014. Further, the Independent Directors have also confirmed that they
are not aware of any circumstance or situation, which exists or may be reasonably
anticipated, that could impair or impact their ability to discharge their duties as
Independent Directors of the Company.
The Board is of the opinion that the Independent Directors of the
Company possess requisite qualifications, experience and expertise and they hold highest
standards of integrity (including the proficiency) and fulfils the conditions specified in
the Act read with Rules made thereunder and SEBI (LODR) Regulations and are eligible &
independent of the management.
None of the Directors of the Company are disqualified as per the
provisions of Section 164 of the Act. The Directors of the Company have made necessary
disclosures under Section 184 and other relevant provisions of the Act.
Brief resume and other details of the Directors being
appointed/re-appointed at the ensuing AGM as stipulated under Secretarial Standard-2
issued by the Institute of Company Secretaries of India and Regulation 36 of the SEBI
(LODR) Regulations, is separately disclosed in the Notice of ensuing AGM.
Upon completion of their second consecutive term, Mr. Pradeep Sardana
(DIN: 00682961) and Dr. Naresh Trehan (DIN: 00012148) ceased to be Independent Directors
of your Company w.e.f. March 27, 2023 and November 30, 2023 respectively.
Further, NRC and Board of Directors of the Company in their meetings
held on February 5, 2024 approved and recommended the appointment of Dr. Naresh Trehan
(DIN: 00012148) as a Non-Executive Non-Independent Director of the Company, liable to
retire by rotation, with effect from April 21, 2024 for approval of the Members at the
ensuing AGM of the Company. The Company has received a notice in writing under Section 160
of the Act from a member proposing his candidature for the office of Director and Dr.
Trehan has also consented to act as Director of the Company and affirmed that he is not
debarred from holding the office of Director by virtue of any order of SEBI or any other
such Authority.
The NRC and Board of Directors are of the view that his skill,
background and experience are aligned to the role and capabilities identified by NRC and
that he is eligible for appointment as a Non-Executive Non-Independent Director of the
Company.
Key Managerial Personnel
Mr. Lalit Malik was appointed as a Chief Financial Officer and Key
Managerial Personnel of the Company
w.e.f. August 4, 2023 in accordance with the provisions of Section 203
of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, in place of Mr. Rajesh Chawla, who continues to discharge his
responsibilities as CFO (India) of your Company.
Further, Mr. Raj Gandhi (DIN: 00003649), Whole-time Director and Mr.
Ravi Batra, Chief Risk Officer & Group Company Secretary, continued to be the Key
Managerial Personnel of your Company in accordance with the provisions of Section 203 of
the Act read with the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014.
Board Evaluation
To comply with the provisions of Section 134(3)(p) of the Act and Rules
made thereunder and Regulation 17(10) of SEBI (LODR) Regulations, the Board has carried
out the annual performance evaluation of the Directors individually including the
Independent Directors (wherein the concerned Director being evaluated did not
participate), Board as a whole and following Committees of the Board of Directors:
- Audit, Risk Management and Ethics Committee;
- Nomination and Remuneration Committee;
- Stakeholders' Relationship Committee; and
- Corporate Social Responsibility Committee.
The manner in which the annual performance evaluation has been carried
out is explained in the Corporate Governance Report which forms part of this report. Board
is responsible to monitor and review the evaluation framework.
Further, to comply with Regulation 25(4) of SEBI (LODR) Regulations,
Independent Directors also evaluated the performance of Non-Independent Directors,
Chairman and Board as a whole at a separate meeting of Independent Directors.
Board and Committees of the Board
The number of meetings of the Board and various Committees of the
Board including composition are set out in the Corporate Governance Report which
forms part of this report. The intervening gap between the meetings was
within the period prescribed under the provisions of Section 173 of the Act and SEBI
(LODR) Regulations.
Remuneration Policy
To comply with the provisions of Section 178 of the Act and Rules
made thereunder and Regulation 19 of SEBI (LODR) Regulations, the Company's
Remuneration Policy for Directors, Key Managerial Personnel (KMP), Senior Management and
other Employees of the Company is uploaded on website of the Company at https://
varunbeverages.com/wp-content/uploads/2023/03/12- Remuneration-Policy.pdf The Policy
includes, inter- alia, the criteria for appointment and remuneration of Directors, KMPs,
Senior Management Personnel and other employees of the Company.
Remuneration of Directors, Key Managerial Personnel and Particulars
of Employees
The statement of disclosure of remuneration under Section 197 of
the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 (‘Rules'), is attached to this report as Annexure
– A.
Further, as per second proviso to Section 136(1) of the Act read with
Rule 5 of the Rules, the Board's Report and Financial Statements are being sent to
the Members of the Company excluding the statement of particulars of employees as required
under Rule 5(2) of the Rules. Any member interested in obtaining a copy of the said
statement may write to the Compliance Officer at complianceofficer@rjcorp.in up to the
date of AGM. The said statement is also available for inspection by the Members at the
Registered Office of your Company on all days except Saturday, Sunday and Public Holiday
up to the date of AGM i.e. April 3, 2024 between 11:00 a.m. to 5:00 p.m.
Statutory Auditors
The Shareholders of the Company in their 27th & 28th
AGM held on April 7, 2022 and March 27, 2023 respectively appointed M/s. O P Bagla &
Co. LLP, Chartered Accountants (Firm Registration Number 000018N/N500091) and M/s. J C
Bhalla & Co., Chartered Accountants (Firm Registration Number 001111N) as Joint
Statutory Auditors of the Company for a period of upto 5(Five) consecutive years to hold
office till the conclusion of AGM to be held in the year 2027 and 2028 respectively. They
have also confirmed that they are not disqualified from continuing as Joint Statutory
Auditors of the Company.
The Statutory Auditors' Report for the Financial Year 2023 does
not contain any qualification, reservation or adverse remark and forms part of the Annual
Report. The Statutory Auditors have not reported any fraud under Section 143(12) of the
Act.
Cost Audit
In terms of Section 148 of the Act and the Companies (Cost Records
and Audit) Rules, 2014, Cost Audit is not applicable on the Company for the Financial Year
2023.
Disclosure under Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013
To comply with the provisions of Section 134 of the Act and Rules
made thereunder, your Company has complied with the provisions relating to constitution of
Internal Complaints Committee under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.
During the year under review, no complaint was received under the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Vigil Mechanism/Whistle Blower Policy
Pursuant to the provisions of Section 177 of the Act and Regulation
22 of SEBI (LODR) Regulations, the Company has adopted a Vigil Mechanism/Whistle Blower
Policy to provide a platform to the Directors and Employees of the Company to raise
concerns regarding any irregularity, misconduct or unethical matters/dealings within the
Company. The same is detailed in the Corporate Governance Report which forms part of this
report.
Secretarial Auditors
The Board of Directors on recommendation of the Audit, Risk
Management and Ethics Committee, have appointed M/s. Sanjay Grover & Associates,
Company Secretaries (Firm Registration No.: P2001DE052900) to conduct Secretarial Audit of
your Company.
The Secretarial Audit Report for the Financial Year 2023 does not
contain any qualification, reservation or adverse remark and is attached to this report as
Annexure - B.
Risk Management
The Audit, Risk Management and Ethics Committee of the Board of
Directors inter-alia monitor and review the risk management plan and such other functions
as assigned from time to time.
Your Company has a robust Risk Management Policy which identifies and
evaluates business risks and opportunities.
The Company recognize that these risks needs to be managed and
mitigated to protect the interest of the stakeholders and to achieve business objectives.
The risk management framework is aimed at effectively mitigating the Company's
various business and operational risks through strategic actions.
Internal Financial Controls
Your Company has in place adequate Internal Financial Controls. The
report on Internal Financial Controls issued by M/s. J C Bhalla & Co., Chartered
Accountants and M/s. O P Bagla & Co. LLP, Chartered Accountants, Joint Statutory
Auditors of the Company is annexed to the Audit Report on the Financial Statements of the
Company and does not contain any reportable weakness in the Company.
Corporate Social Responsibility (CSR)
Your Company has a Corporate Social Responsibility Policy which is
uploaded on website of the Company at https://varunbeverages.com/wp-content/uploads/
2023/05/24-CSR-Policy-Clear-Version.pdf
Annual Report on CSR activities for the Financial Year 2023 as required
under Sections 134 and 135 of the Act read with Rule 8 of the Companies (Corporate Social
Responsibility Policy) Rules, 2014 and Rule 9 of the Companies (Accounts) Rules, 2014 is
attached to this report as Annexure - C.
Directors' Responsibility Statement
Pursuant to Section 134(3)(c) read with Section 134(5) of the Act,
the Directors state that:
- in the preparation of the annual accounts for the Financial Year ended December 31,
2023, the applicable accounting standards have been followed along with proper explanation
relating to material departures;
- they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of your Company as at December 31, 2023 and of the profits of the
Company for the period ended on that date;
- proper and sufficient care have been taken for the maintenance of adequate accounting
records in accordance with the provisions of Act for safeguarding the assets of your
Company and for preventing and detecting fraud and other irregularities;
- the annual accounts have been prepared on a going concern basis;
- proper internal financial controls laid down by the Directors were followed by the
Company and that such internal financial controls were adequate and operating effectively;
and
- proper systems to ensure compliance with the provisions of all applicable laws were in
place and that such systems were adequate and operating effectively.
Other Information
Management Discussion & Analysis Report
Management Discussion & Analysis Report for the Financial Year
2023, as stipulated under Regulation 34(2)(e) of SEBI (LODR) Regulations, forms part of
the Annual Report.
Business Responsibility and Sustainability Report
Business Responsibility and Sustainability Report for the Financial
Year 2023 describing the initiatives taken by the Company from an Environment, Social and
Governance perspective as stipulated under Regulation 34(2)(f) of SEBI (LODR) Regulations
forms part of the Annual Report.
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo
The information on conservation of energy, technology absorption and
foreign exchange earnings and outgo as stipulated under Section 134(3)(m) of the Act read
with Rule 8 of the Companies (Accounts) Rules, 2014 is attached to this report as Annexure
- D.
Corporate Governance Report
Your Company is committed to maintain the highest standards of
Corporate Governance and adhere to the Corporate Governance requirements set out by
Securities and Exchange Board of India. The report on Corporate Governance as stipulated
under the SEBI (LODR) Regulations is attached to this report as Annexure - E. The
certificate from M/s. Sanjay Grover & Associates, Practicing Company Secretaries
confirming compliance with the conditions of corporate governance is also attached to the
Corporate Governance Report.
Awards/Recognitions
During the year, your Company has received the following awards:
- PepsiCo's International Bottler of the Year 2022
- PepsiCo's Best Bottler in the Africa-Middle East-
South Asia region
- PepsiCo's 'Better' category award for our sustainability endeavors
- Business Excellence (Corporate Governance) of The Year 2022 award by Prime Time Research
Media Pvt. Ltd.
- Best Corporate Governance Practices - Varun Beverages Limited award under Business Brand
Awards
Listing
The Equity Shares of the Company are listed on the National Stock
Exchange of India Limited and BSE Limited. Both these stock exchanges have nation-wide
trading terminals. Annual listing fee for the Financial Year 2023-24 has been paid to the
National Stock Exchange of India Limited and BSE Limited.
Annual Return
Pursuant to Sections 92(3) and 134(3)(a) of the Act, the Annual Return
of the Company is uploaded on website of the Company at https://varunbeverages.com/
annual-reports/
Research and Development
During the year under review, no Research & Development was carried
out.
Cautionary Statement
Statements in the Board's Report and the Management Discussion
& Analysis Report describing the Company's objectives, expectations or forecasts
may be forward looking within the meaning of applicable laws and regulations. Actual
results may differ from those expressed in the statements.
General
Your Directors confirm that no disclosure or reporting is required in
respect of the following items as there was no transaction on these items during the year
under review:
- Issue of equity shares with differential voting rights as to dividend, voting or
otherwise.
- The Whole-time Directors of the Company does not receive any remuneration or commission
from any of its subsidiaries.
- No significant or material orders were passed by the Regulators or Courts or Tribunals
which impact the going concern status and Company's operations in future.
- Issue of Sweat Equity Shares.
- No application made or any proceeding pending under Insolvency and Bankruptcy Code, 2016
as at the end of the Financial Year 2023.
- Details of difference between the amount of valuation at the time of one time settlement
and valuation done while taking loan from banks or financial institutions are not
applicable.
The Company is in regular compliance of the applicable provisions of
Secretarial Standards issued by the Institute of Company Secretaries of India.
No material changes and commitments have occurred after the closure of
the Financial Year 2023 till the date of this Report, which would affect the financial
position of your Company.
Acknowledgement
Your Company's organizational culture upholds professionalism, integrity and
continuous improvement
Your Directors wish to place on record their appreciation for the
sincere services rendered by employees of the Company at all levels. Your Directors also
wish to place on record their appreciation for the valuable co-operation and support
received from various Government Authorities, Banks/Financial Institutions and other
stakeholders such as members, customers and suppliers, among others. Your Directors also
commend the continuing commitment and dedication of employees at all levels which has been
vital for the Company's success. Your Directors look forward to their continued
support in future.
For and on behalf of the Board of Directors
For Varun Beverages Limited
Ravi Jaipuria
across all functions as well as efficient utilization of the
Company's resources for sustainable and profitable growth.