Varun Beverages Enters Alcoholic Beverages With KIVA Spirits Subsidiary

Varun Beverages is preparing to enter the alcoholic beverages market through a new wholly owned subsidiary, marking a shift beyond its core business of soft drinks and other non-alcoholic beverages. The company’s board approved the incorporation of KIVA Spirits and Company Limited on August 25 to manufacture and sell ready-to-drink (RTD) alcoholic beverages and related products, subject to regulatory approvals.

KIVA Spirits will be fully owned by Varun Beverages and is proposed to have an authorised share capital of Rs 10 crore and paid-up equity capital of Rs 9 crore. The capital will be funded in cash by the parent company. The company has not yet disclosed the specific alcoholic beverage categories it plans to launch, expected launch timelines or any investment beyond the initial capitalisation.

Varun Beverages has appointed Prathmesh Mishra as Chief Executive and Managing Director of the proposed subsidiary. Mishra brings more than three decades of experience in consumer businesses and most recently served as Managing Director for Korea and Japan at Diageo. He has also held senior roles at Diageo India, including Chief Commercial Officer and Chief Operating Officer for the western region, and spent 14 years in leadership positions at Pernod Ricard India.

The appointment places an executive with experience across two major global spirits companies at the helm of Varun Beverages’ proposed alcohol business, indicating that the company is establishing a dedicated leadership structure for the new category.

Separately, Varun Beverages has approved plans to establish a joint venture in Tunisia as part of its international beverage expansion. The proposed entity, Varun Beverages Tunisia SA or another name approved by local authorities, will manufacture and distribute carbonated soft drinks, juices, water and dairy products.

The Tunisia joint venture will have proposed share capital of 9 million Tunisian dinars, with Varun Beverages holding 75 percent and Tunisia-based Bevanda owning the remaining 25 percent. While the KIVA Spirits subsidiary represents a move into alcoholic beverages, the Tunisia joint venture will remain focused on Varun Beverages’ existing non-alcoholic beverage categories.

Varun Beverages is among PepsiCo’s largest franchise bottlers outside the US and manufactures and distributes beverages under PepsiCo-owned brands across its operating markets. Shares of Varun Beverages closed 2.34 percent higher at Rs 438 on Tuesday, gaining Rs 10 during the session.