Shares of Varun Beverages surged 5% on November 14 after news of its plan to raise up to Rs 7,500 crore through a Qualified Institutional Placement (QIP). The company received board approval for this fundraising back in October, and the base deal size is set at Rs 5,500 crore, with an option to increase by Rs 2,000 crore. The QIP price is expected to be Rs 565 per share, offering a small discount compared to recent prices. By issuing new shares, the equity dilution is estimated at 4.1%. Motilal Oswal Investment Advisors and other firms are the lead managers.
This QIP will support Varun Beverages’ expansion, as it seeks to grow its business through investments in subsidiaries, joint ventures, and new markets. Funds will also help expand its product line and facilitate strategic acquisitions.
Varun Beverages posted stellar earnings for Q2FY25, with net growing to Rs 619.6 crore, while revenue improved 24% to Rs 4,805 crore. Recently, it also announced 100% stake in two African subsidiaries of SBC Tanzania for Rs 1,304 crore and SBC Beverages Ghana for Rs 127.1 crore, further making the company’s presence more solid across geographies as one of the largest PepsiCo bottlers.
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Source: Moneycontrol
News Desk
