Varun Beverages Ltd.’s (VBL) board meeting on Wednesday, October 9, concluded with approval for raising up to Rs 7,500 crore through qualified institutions placement (QIP).

The funds may be raised in one or multiple tranches through QIP. To obtain shareholder approval for the fundraiser, a postal ballot notice will be sent out. The company still needs to provide details on how it plans to use the fundraiser’s proceeds, if any.

VBL is the second-largest soft drink bottler in India, with a 28% market share of the carbonated soft drink (CSD) market. Coca-Cola, owned by another company, and competitor to varun beverages has its fragmented bottling system with a larger market share, at 55%.

Sting Energy contributes to 15% of the company’s volume. VBL also manufactures and sells sports drinks, juice, and dairy beverages, with dairy-based products seen as a potential avenue for growth. Additionally, 19% of VBL’s volume comes from frontier markets outside India, particularly in Africa.

Since its initial public offering on November 8, 2016, VBL’s stock has performed better than the market, propelled by robust volume growth and profitability. The company’s EBITDA margin, currently at 23%, is already approaching the higher end for global bottling companies.

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