Varun Beverages Ltd Auditor Reports

To the Members of Varun Beverages Limited

Report on the Audit of the Standalone Financial Statements

Opinion

? We have audited the accompanying standalone financial statements of Varun Beverages Limited (the Company), which comprise the Standalone Balance Sheet as at 31 December 2025, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Cash Flow and the Standalone Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including material accounting policy information and other explanatory information.

? In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (the Act) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 December 2025, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

? We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

? Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

? We have determined the matters described below to be the key audit matters to be communicated in our report.

Key audit matter

How our audit addressed the key audit matter

Impairment assessment of intangible assets including goodwill Refer note 3.12 and 3.5 for accounting policies on Goodwill and Intangibles assets respectively. Further refer note 5A and 5B to the standalone financial statements. The Company carries Goodwill and franchise rights/ trademarks as intangible assets having indefinite life amounting to 19.40 million and 5,385.99 million respectively, that are required to be tested for impairment by the management on an annual basis in accordance with Ind AS 36, Impairment of Assets.

Our audit procedures included, but were not limited, the following: ? Obtained an understanding of the managements process for identification of cash generating unit and processes performed by the management for their impairment testing; Assessed the process by which management prepared its cash flow forecasts and held discussions with management to understand the assumptions used and estimates made by them for determining such projections;

Key audit matter	How our audit addressed the key audit matter
The aforesaid assessment of the impairment testing involves significant judgement around the determination of the recoverable amounts, being the higher of value in use and fair value less costs of disposal. Recoverable amounts are based on managements view of the future cash flows and prospects of the business, the appropriate discount rates and other industry specific risk factors.	? Tested the design and operating effectiveness of internal controls over such identification and impairment test procedures; Assessed the appropriateness of the Companys accounting policies, including those relating to recognition, measurement and impairment of intangibles by comparing with the applicable Ind AS;
The key judgements in determining the recoverable amounts relates to the forecast of future cash flows based on strategy using macroeconomic assumptions such as industry growth, inflation and expected growth in market share, capital expenditure and working capital requirements, among others. Changes in the management forecasts or assumptions can impact the assessment of the discounted cash flows. Considering the materiality of the amounts involved and significant degree of judgement and subjectivity involved in the estimates and key assumptions used in determining the forecasted cash flows used in the impairment evaluation, which are dependent on current and future economic factors and trading conditions varying for different economic and geographical territories, impairment assessment of Goodwill and the Franchise rights/ trademarks was determined as a key audit matter.	? Reviewed the valuation report obtained by the management from an independent valuer for Franchise rights and Goodwill and assessed the professional competence, skills and objectivity for performing the required valuations; ? Assessed the appropriateness of the significant assumptions as well as the Companys valuation model with the support of auditors valuation specialists, who assess the reasonableness of assumptions used and valuation methodology applied relating to discount rate, risk premium, industry growth rate etc. This included a discussion of the expected development of the business and results as well as of the underlying assumptions used with those responsible for the planning process. Assessed the robustness of financial projections prepared by the management by comparing projections for previous financial years with actual results realised and discussed significant deviations, if any, with the management;
	Tested mathematical accuracy of the projections and performed a sensitivity analysis for reasonably possible changes in the sales growth, discount rate applied and the long-term growth rate; and
	Evaluated the adequacy and appropriateness of disclosures made by the Company in the standalone financial statements, as required by the applicable provisions of the Act and Ind AS.
Claims, Appeals and Litigations - provisions and contingent liabilities	Our audit procedures included, but were not limited to, the following:
(Refer note 40 to the standalone financial statements for the amounts of contingent liabilities) The Company is involved in various direct, indirect tax and other claims, appeals and litigations (hereafter, referred to as "Matters") that are pending with different statutory authorities and judicial courts. The management exercises significant judgement for determining the need for and the amount of provisions, for any liabilities, arising from these matters.	? Assessed the appropriateness of the Companys accounting policies relating to provisions and contingent liabilities with the applicable accounting standards; Assessed the Companys process and the underlying controls for identification of the pending matters and completeness for financial reporting and also for monitoring of significant developments in relation to such pending matters;

Key audit matter

How our audit addressed the key audit matter

This judgement is dependent on a number of significant assumptions and evaluations which involves interpreting the various applicable rules, regulations, practices and considering precedents in the various jurisdictions including the opinions received from various legal counsels. This matter is considered as a key audit matter, in view of the uncertainty regarding the outcome of these matters, the significance of the amounts involved and the subjectivity involved in managements judgement as to whether any amount should be recognised as a provision or be disclosed or not as a contingent liability in the standalone financial statements.

? Assessed the managements assumptions and estimates in respect of matters, including the liabilities or provisions recognised or contingent liabilities disclosed in the standalone financial statements. This involved assessing the probability of an unfavorable outcome of a given proceeding and the reliability of estimates of related amounts based on the various legal counsels opinions received by the Company; ? Recomputed the arithmetical accuracy of the underlying calculations supporting the provisions recorded from the supporting evidences including the correspondence with various authorities; ? Assessed the managements conclusions through understanding relevant judicial precedents in similar cases and the applicable rules and regulations and through a discussion with Companys legal department and legal counsels appointed by the Company; ? Obtained legal opinions and confirmation on completeness from the Companys external legal counsels, where appropriate; ? Engaged auditors experts to gain an understanding of the current status of matters and changes in the disputes, if any, through discussions with the management and by reading external advice received by the Company, where relevant, to validate managements conclusions; and Assessed the appropriateness of the Companys description of the accounting policy, disclosures related to matters and whether these are adequately presented in the standalone financial statements.

Information other than the Standalone Financial Statements and Auditors Report thereon

? The Companys Board of Directors are responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Report on Corporate Governance and Directors Report, but does not include the standalone financial statements and our auditors report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our

knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

? The accompanying standalone financial statements have been approved by the Companys Board of Directors. The Companys Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance

with the Ind AS specified under section 133 of the Act and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

? In preparing the standalone financial statements, the Board of Directors is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

? The Board of Directors is also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Standalone Financial Statements

? Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

? As part of an audit in accordance with Standards on Auditing, specified under section 143(10) of the Act we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

? Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

? Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls;

? Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;

? Conclude on the appropriateness of Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern; and

? Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

? We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

? We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

? From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

? As required by section 197(16) of the Act, based on our audit, we report that the Company has paid remuneration to its directors during the year in accordance with the provisions of and limits laid down under section 197 read with Schedule V to the Act.

? As required by the Companies (Auditors Report) Order, 2020 (the Order) issued by the Central Government of India in terms of section 143(11) of the Act we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

? Further to our comments in Annexure I, as required by section 143(3) of the Act based on our audit, we report, to the extent applicable, that:

? We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the accompanying standalone financial statements;

? In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books, except for the matters stated in paragraph 17(h)(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended);

? The standalone financial statements dealt with by this report are in agreement with the books of account;

? In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under section 133 of the Act;

? On the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2025 from being appointed as a director in terms of section 164(2) of the Act;

? The modification relating to the maintenance of accounts and other matters connected therewith are as stated in paragraph 17(b) above on reporting under section 143(3)(b) of the Act and paragraph 17(h)(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended);

? With respect to the adequacy of the internal financial controls with reference to financial statements of the Company as on 31 December 2025 and the operating effectiveness of such controls, refer to our separate report in Annexure II wherein we have expressed an unmodified opinion; and

? With respect to the other matters to be included in the Auditors Report in accordance with rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:

? The Company, as detailed in note 40 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position as at 31 December 2025;

? The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at 31 December 2025;

? There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31 December 2025;

? a. The management has represented that, to the best of its knowledge and belief, as disclosed in note 57(e) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any person(s)

or entity(ies), including foreign entities ( the intermediaries), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (the Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries;

? The management has represented that, to the best of its knowledge and belief, as disclosed in note 57(f) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ( the Funding Parties), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

? Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement.

? The interim dividend declared and paid by the Company during the year ended 31 December 2025 and until the date of this audit report is in compliance with section 123 of the Act.

The final dividend paid by the Company during the year ended 31 December 2025 in respect of such dividend declared for the previous year is in accordance with section 123 of the Act to the extent it applies to payment of dividend.

As stated in note 61 to the accompanying standalone financial statements, the Board of Directors of the Company have proposed final dividend for the year ended 31 December 2025 which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent it applies to declaration of dividend.

? Based on our examination which included test checks, the Company, in respect of financial year commencing on 01 January 2025, has used two accounting software for maintaining its books of account which have a feature of recording audit trail (edit log) facility and the same have been operated throughout the year for all relevant transactions recorded in the software. However, the audit trail feature was not enabled at database level for one accounting software to log any direct data changes, as described in note 60 to the standalone financial statements.

Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with in respect of these accounting software and the audit trail has been preserved by the Company as per the statutory requirements for record retention.

For J. C. Bhalla & Co. For O P Bagla & Co LLP

Chartered Accountants Chartered Accountants

Firms Registration No. 001111N Firms Registration No: 000018N/N500091

Akhil Bhalla Neeraj Kumar Agarwal

Partner Partner

Membership No: 505002 Membership No. 094155

UDIN: 26505002FPNXFO5150 UDIN: 26094155BLUDUH3304

Place: Gurugram Place: Gurugram

Date: 03 February 2026 Date: 03 February 2026

B-5, Sector-6, Noida Uttar Pradesh 201301

B-225, 5^th Floor, Okhla Industrial Area, Phase 1, New Delhi 110020

Annexure I referred to in paragraph 16 of the Independent Auditors Report of even date to the members of Varun Beverages Limited on the standalone financial statements for the year ended 31 December 2025

In terms of the information and explanations sought by us and given by the Company and the books of account and records examined by us in the normal course of audit and to the best of our knowledge and belief, we report that:

? (a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment,capital work-in-progress, non-current assets held for sale and relevant details of right-of- use assets.

(B) The Company has maintained proper records showing full particulars of intangible assets including intangible assets under development.

? The property, plant and equipment (other than refrigerators (Visi coolers) and containers lying with third parties) and right-of-use assets have been physically verified by the management during the year and no material discrepancies

We have directly obtained the confirmation from the trust for title deeds of immovable properties, which are in the nature of land, having gross carrying value of 15,835.10 million as at 31 December 2025. The title deeds of such immovable properties have been mortgaged as security for loans or borrowings taken by the Company.

were noticed on such verification. The Company has a regular programme of physical verification of refrigerators (Visi coolers) under which such assets are verified in a phased manner over a period of three years and no material discrepancies were noticed on such verification. According to the information and explanations given to us, the existence of containers lying with third parties is considered on the basis of the confirmations obtained from such third parties. In our opinion, the frequency of physical verification programme adopted by the Company is reasonable having regard to the size of the Company and the nature of its assets.

? The title deeds of all the immovable properties held by the Company (other than properties where the Company is a lessee), disclosed in Note 4A and 4C to the standalone financial statements, are held in the name of the Company. For properties where the Company is a lessee, the lease arrangements have been duly executed in favour of the Company except in following case:

? The Company has adopted cost model for its Property, Plant and Equipment including right-of-use assets and intangible assets. Accordingly, reporting under clause 3(i)(d) of the Order is not applicable to the Company.

? No proceedings have been initiated or are pending against the Company for holding any benami property under the Prohibition of

Benami Property Transactions Act, 1988 (as amended) and rules made thereunder.

? (a) The management has conducted physical verification of inventory at reasonable intervals during the year, except for goods-in-transit. In our opinion, the coverage and procedure of such verification by the management is appropriate and no discrepancies of 10% or more in the aggregate for each class of inventory were noticed as compared to book records. In respect of goods-in-transit, these have been confirmed from corresponding receipt and dispatch inventory records.

? As disclosed in Note 19B to the standalone financial statements, the Company has been sanctioned a working capital limit in excess of

Further, the Company has made investment in 13 entities amounting to 17,018.02 million (year- end balance 37,704.60 million).

? In our opinion, and according to the information and explanations given to us, the investments made, guarantees provided and terms and conditions of the grant of all loans and guarantees provided are, prima facie, not prejudicial to the interest of the Company. Further the Company has not provided any advances in the nature of loans or has not given any security.

50 million by banks or financial institutions based on the security of current assets. The quarterly statements, in respect of the working capital limits have been filed by the Company with such banks or financial institutions and such statements are in agreement with the books of account of the Company for the respective periods, which were subject to audit/review.

? (a) The Company has not provided security or granted advances in the nature of loans, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or any other parties during the year. The Company has provided guarantees and granted loans, to Subsidiaries during the year as per details given below:

? In respect of loans granted by the Company, the schedule of repayment of principal and payment of interest has been stipulated and the repayments/receipts of principal and interest are regular.

? There is no overdue amount in respect of loans or advances in the nature of loans granted to such companies, firms, LLPs or other parties.

? The Company has granted loan, installments of which had fallen due during the year and such loan was extended during the year. The details of the same has been given below:

Name of the party	Total loan amount granted during the year* ( million)	Aggregate amount of overdues of existing loans extended ( million)	Nature of extension (i.e., renewed/ extended/fresh loan provided)	Percentage of the aggregate to the total loans granted during the year
Varun Beverages Zimbabwe (Private) Limited	547.13	547.13	Extended	100%

*Loans extended have been considered as "loans granted during the year" for the purpose of reporting under this clause.

? The Company has not granted any loans or advances in the nature of loans, which are repayable on demand or without specifying any terms or period of repayment.

? In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of section 186 of the Act in respect of loans and investments made and guarantees provided by it, as applicable. Further, the Company has not entered into any transaction covered under section 185 and section 186 of the Act in respect of security provided by it.

? In our opinion, and according to the information and explanations given to us, the Company has not accepted any deposits or there are no amounts which have been deemed to be deposits within the meaning of sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules , 2014 (as amended). Accordingly, reporting under clause 3(v) of the Order is not applicable to the Company.

? The Central G overnment has specified maintenance of cost records under sub-section

(1) of section 148 of the Act in respect of the

products of the Company. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

? (a) In our opinion, company has generally been regular in depositing undisputed statutory dues, including Goods and Services tax, Provident Fund, Employees State Insurance, Income-Tax, Sales-Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. There were no undisputed amounts payable in respect thereof which were outstanding at the year- end for a period of more than six months from the date they became payable.

? According to the information a nd explanations given to us, we report that there are no statutory dues referred in sub- clause (a) which have not been deposited with the appropriate authorities on account of any dispute except for the following:

Name of the statute	Nature of dues	Forum where dispute is pending	Period to which the amount relates	Gross Amount ( million)	Amount deposited under Protest ( million)
Goods and Services Tax Act, 2017	GST	State Appellate Authority	FY 2019-20 and FY 2025-26	1.11	1.11
		State Tax Office- (Intelligence) Adjudication Cell	FY 2023-24	0.05	0.05
		Commissioner/ Additional Commissioner (Appeals)	FY 2022-23 to FY 2023-24 and FY 2025-26	2.08	2.08
		Assessing Authority	FY 2017-18 to FY 2024-25	419.55	36.62
		High Court - Allahabad	FY 2019-20 and FY 2024-25	1.22	1.22
		High Court - Odisha	FY 2019-20	0.18	0.18

Name of the statute	Nature of dues	Forum where dispute is pending	Period to which the amount relates	Gross Amount ( million)	Amount deposited under Protest ( million)
Central Excise Act, 1944	Central excise	Customs, Excise and Service Tax Appellate Tribunal, Chandigarh	FY 2014-15	13.69	0.68
		Assessing Authority	FY 2014-15 to FY2018-19	1.12	-
The Custom Act, 1962	Custom Duty	Customs, Excise and Service Tax Appellate Tribunal, Mumbai	FY 2016-17 to FY 2023-24	481.87	9.70
Value Added Tax Act, 2003	Value added tax	Deputy Commissioner (Appeal)	FY2009 -10, FY 2015-16 and FY 2016-17	0.04	-
		High Court - Rajasthan	FY2009 -10 to FY 2014-15	582.46	16.75
		State Tribunal - West Bengal	FY2012-13	0.25	0.12
Value Added Tax Act, 2005	Value added tax	Commissioner (Appeals)	FY 2012-13	0.14	0.14
		The Deputy Excise and Taxation Commissioner (Appeals) cum Joint Director (Investigation)	FY 2015-16 to FY 2016-17	0.73	0.14
		Assessing Authority	FY 2017-18	5.75	-
		High Court - Uttarakhand	FY 2015-16 to FY 2016-17	15.02	1.00
Value Added Tax Act, 2008	Value added tax	Assessing Authority	FY 2007-08 to FY 2010-11	14.27	0.10
		Additional Commissioner (Appeals)	FY 2001-02	1.52	0.11
		Tribunal bench-1 - Ghaziabad	FY 2011-12	4.48	4.48
Income-Tax Act, 1961	Income tax	Commissioner Income Tax (Appeals)	AY 2017-18 and AY 2018-19	2.64	-
		Income Tax Appellate Tribunal	AY 2016-17 to AY 2018-19 and AY 2020-21	39.31	0.20
		High Court - New Delhi	AY 2012-13	39.00	-

? According to the information and explanations given to us, we report that no transactions were surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961) which have not been previously recorded in the books of accounts.

? (a) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of its loans or borrowings or in the payment of interest thereon to any lender.

? According to the information and explanations given to us including representation received from the management of the Company, and on the basis of our audit procedures, we report that the Company has not been declared a willful defaulter by any bank or financial institution or government or any government authority.

? In our opinion and according to the information and explanations given to us, money raised by way of term loans were applied for the purposes for which these were obtained.

? In our opinion and according to the information and explanations given to us, and on an overall examination of the financial statements of the Company, funds raised by the Company on short term basis have, prima facie, not been utilised for long term purposes.

? In our opinion and according to the information and explanations given to us and on an overall examination of the financial statements of the Company, the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures.

? In our opinion and according to the information and explanations given to us, the Company has not raised any loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies.

? (a) The Company has not raised any money by way of initial public offer or further public offer (including debt instruments), during the year. Accordingly, reporting under clause 3(x)(a) of the Order is not applicable to the Company.

? According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully, partially or optionally convertible debentures during the year. Further, money raised towards the end of previous year by way of private placement (Qualified Institutional Placement) were fully applied for the purposes for which these were obtained.

? (a) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or no fraud on the Company has been noticed or reported during the period covered by our audit.

? According to the information and explanations given to us including the representation made to us by the management of the Company, no report under sub-section 12 of section 143 of the Act has been filed by the auditors in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014, with the Central Government for the period covered by our audit.

? According to the information and explanations given to us including the representation made to us by the management of the Company, there are no whistle-blower complaints received by the Company during the year.

? The Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it. Accordingly, reporting under clause 3(xii) of the Order is not applicable to the Company.

? In our opinion and according to the information and explanations given to us, all transactions entered into by the Company with the related parties are in compliance with sections 177 and 188 of the Act, where applicable. Further, the details of such related party transactions have been disclosed in the standalone financial statements, as required Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified in Companies (Indian Accounting Standards) Rules 2015 as prescribed under section 133 of the Act.

? (a) In our opinion and according to the information and explanations given to us, the Company has an internal audit system which is commensurate with the size and nature of its business as required under the provisions of section 138 of the Act.

? We have considered the reports issued by the Internal Auditors of the Company till date for the period under audit.

? According to the information and explanation given to us, the Company has not entered into any non-cash transactions with its directors or persons connected with its directors and accordingly, reporting under clause 3(xv) of the Order with respect to compliance with the provisions of section 192 of the Act are not applicable to the Company.

? The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, reporting under clauses 3(xvi)(a), (b) and (c) of the Order are not applicable to the Company.

(d) Based on the information and explanations given to us and as represented by the management of the Company, the Group (as defined in Core Investment Companies (Reserve Bank) Directions, 2016) has only one CIC as part of the Group.

? The Company has not incurred any cash losses in the current financial year as well as the immediately preceding financial year.

? There has been no resignation of the statutory auditors during the year. Accordingly, reporting under clause 3(xviii) of the Order is not applicable to the Company.

? According to the information and explanations given to us and on the basis of the financial ratios, ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information in the standalone financial statements, our knowledge of the plans of the Board of Directors and management and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report indicating that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the company as and when they fall due.

? (a) In our opinion and according to the information and explanations given to us, there are no unspent amounts towards Corporate Social Responsibility pertaining to other than ongoing projects as at end of the current financial year. Accordingly, reporting under clause 3(xx)(a) of the Order is not applicable to the Company.

? In our opinion and according to the information and explanations given to us, the unspent amounts towards Corporate Social Responsibility (CSR) pertaining to the ongoing projects as at the end of the current financial year is kept in a separate bank account with RJ foundation (i.e., trust established for carrying the CSR activities). Details are given below:

Financial year	Amount identified for Spending on CSR activities for "On going Projects" ( million)	Unspent amount not transferred to a special account ( million)*
(a)	(b)	(c)
2025	462.80	171.54

*The unspent amount towards CSR of 171.54 million related to ongoing projects is kept in a separate bank account with RJ foundation (i.e., trust established for carrying the CSR activities).

? The reporting under clause 3(xxi) of the Order is not applicable in respect of audit of standalone financial statements of the Company. Accordingly, no comment has been included in respect of said clause under this report.

For J. C. Bhalla & Co. For O P Bagla & Co LLP

Chartered Accountants Chartered Accountants

Firms Registration No. 001111N Firms Registration No: 000018N/N500091

Akhil Bhalla Neeraj Kumar Agarwal

Partner Partner

Membership No: 505002 Membership No. 094155

UDIN: 26505002FPNXFO5150 UDIN: 26094155BLUDUH3304

Place: Gurugram Place: Gurugram

Date: 03 February 2026 Date: 03 February 2026

B-5, Sector-6, Noida Uttar Pradesh 201301

B-225, 5^th Floor, Okhla Industrial Area, Phase 1, New Delhi 110020

Annexure II

Independent Auditors Report on the internal financial controls with reference to the standalone financial

statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (the Act)

? In conjunction with our audit of the standalone financial statements of Varun Beverages Limited (the Company) as at and for the year ended 31 December 2025, we have audited the internal financial controls with reference to financial statements of the Company as at that date.

Responsibilities of Management and Those Charged with Governance for Internal Financial Controls

? The Companys Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal financial controls with reference to standalone financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the Guidance Note) issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the Companys business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility for the Audit of the Internal Financial Controls with Reference to Financial Statements

? Our responsibility is to express an opinion on the Companys internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India (ICAI) prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to financial statements, and the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the Guidance Note) issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference

to financial statements were established and maintained and if such controls operated effectively in all material respects.

? Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements includes obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

? We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls with reference to financial statements.

Meaning of Internal Financial Controls with Reference to Financial Statements

? A companys internal financial controls with reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial controls with reference to financial statements include those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with Reference to Financial Statements

? Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

? In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial statements and such controls were operating effectively as at 31 December 2025, based on the internal financial controls with reference to standalone financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI.

For J. C. Bhalla & Co. For O P Bagla & Co LLP

Chartered Accountants Chartered Accountants

Firms Registration No. 001111N Firms Registration No: 000018N/N500091

Akhil Bhalla Neeraj Kumar Agarwal

Partner Partner

Membership No: 505002 Membership No. 094155

UDIN: 26505002FPNXFO5150 UDIN: 26094155BLUDUH3304

Place: Gurugram Place: Gurugram

Date: 03 February 2026 Date: 03 February 2026

B-5, Sector-6, Noida Uttar Pradesh 201301

B-225, 5^th Floor, Okhla Industrial Area, Phase 1, New Delhi 110020