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Varun Beverages Enters Alcoholic Beverages Market Through New Subsidiary
Varun Beverages shares declined in morning trade after the company announced plans to enter the alcoholic beverages segment through a new wholly owned subsidiary. The company has incorporated KIVA Spirits and Company to develop ready to drink alcoholic beverages and has appointed former Diageo executive Prathmesh Mishra as its CEO and managing director.
By Finblage Editorial Desk
3:40 pm
26 August 2026
Varun Beverages shares traded lower on Wednesday after the company announced its entry into the alcoholic beverages segment through a newly incorporated wholly owned subsidiary.
Varun Beverages shares were trading at Rs 428.90 on the NSE at 10:05 am, down Rs 9.10 or 2.08 percent.
The company had announced on Tuesday that its board approved the incorporation of KIVA Spirits and Company to undertake the business of ready to drink alcoholic beverages and allied products, subject to obtaining the requisite regulatory approvals.
Varun Beverages has also appointed former Diageo executive Prathmesh Mishra as the CEO and managing director of the new subsidiary. His appointment is expected to support the company's plans to establish a presence in the alcoholic beverages market.
The move follows amendments to Varun Beverages' exclusive bottling appointment and trademark licence agreement with PepsiCo. The changes removed a restriction that had previously prevented Varun Beverages from undertaking activities beyond PepsiCo's products, allowing the company to explore additional beverage categories.
Separately, Varun Beverages has approved the incorporation of a joint venture in Tunisia. The proposed venture will focus on the production and distribution of beverages, including carbonated soft drinks, juices, water and dairy products.
Brokerage firm CLSA has retained its high conviction Outperform rating on Varun Beverages with a target price of Rs 629 per share. CLSA said the company's entry into alcoholic beverages could significantly expand its addressable market.
The brokerage estimates the Indian alcoholic beverages market at around $50.8 billion and expects premiumisation to support long term growth. It also sees potential for Varun Beverages to build a global alcoholic beverages business through Scotch whisky and local partnerships.
The diversification marks a strategic expansion for Varun Beverages beyond its traditional PepsiCo linked beverage operations and could provide the company with additional avenues for long term growth.
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