Varun Beverages shares fell 5% after the Pepsi bottler reported a 76-basis-point contraction in its Q2 CY2026 EBITDA margin to 27.7%, weighed down by the consolidation of South Africa's Twizza business. Despite the pressure on margins, revenue from operations rose 20.4% year-on-year to Rs 8,451.23 crore, supported by strong volume growth across domestic and international markets.

The company said the Twizza acquisition in South Africa affected profitability during the quarter, even as overall sales expanded. Net profit rose 15% year-on-year, reflecting continued growth in the business despite the margin decline. For investors and industry watchers, the quarter highlights the trade-off that can follow acquisitions in new geographies: higher reported scale can come with near-term integration and consolidation costs, making margin trends just as important as top-line growth when assessing operating performance.

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