Varun Beverages Forays Into The Alcoholic Beverages Segment With New Subsidiary

Varun Beverages (VBL), one of PepsiCo’s largest bottling partners outside the United States, has taken its first formal step into the alcohol market. On 31 August 2026, the company incorporated a wholly-owned subsidiary, KIVA Spirits and Company.

This new business will operate in the alcoholic beverages space, a category that Varun Beverages has never entered before.

So what is VBL planning for this new business, and how big is the opportunity?

About KIVA Spirits And Company

KIVA Spirits has been set up to carry on the business of ready-to-drink beverages, alcoholic beverages and allied products.

Key details of the new subsidiary:

• Ownership: 100% held by Varun Beverages

• Authorised share capital: ₹10 Cr.

• Paid-up equity capital: ₹9 Cr.

• Face value: ₹10 per share

With this, Varun Beverages has added a new category in its vast portfolio spanning existing soft drinks and packaged water.

Who Will Lead The Alcohol Business?

The company has appointed Prathmesh Mishra as Chief Executive Officer and Managing Director of the new subsidiary. Mishra brings more than 30 years of experience across consumer businesses.

He most recently served as Managing Director of Korea and Japan at Diageo, and earlier spent seven years as Chief Commercial Officer at Diageo India.

Before that, he worked with Pernod Ricard India for 14 years across a range of leadership roles. He has also served as Chairman of Royal Challengers Bangalore (RCB).

His long track record in spirits and premium consumer markets points to the kind of expertise VBL is bringing in as it builds the business from scratch.

During the same meeting last week when the board approved the setting up of the Alcohol business, they had also cleared a separate joint venture in Tunisia, expanding the company’s international footprint.

Varun Beverages Stock Price Performance

The initial reaction in VBL’s stock to the new venture was cautious. On 26 August, a day after the board’s approval, VBL shares fell nearly 4% to a three-month low of ₹420.55 on the National Stock Exchange (NSE), as volumes jumped to around three times the usual.

Today, on 31 August, at 11:23 am, Varun Beverages’ share price slipped 0.92% to ₹410.20.

Several brokerages have presented a cautious stance to this with some of them trimming their near-term estimates to factor in the margin impact of the new business.

Also Read - HDFC Bank Board Begins Succession Search As CEO Jagdishan Confirms Exit