Varun Beverages Ltd., a prominent bottling partner for PepsiCo in India, is making a strategic entry into the alcoholic beverages market. The company announced the formation of a new wholly-owned subsidiary, KIVA Spirits and Company Ltd., which will focus on ready-to-drink (RTD) alcoholic beverages and related products.
Leadership for KIVA Spirits
To spearhead this significant diversification, Varun Beverages has appointed Prathmesh Mishra as the Chief Executive Officer and Managing Director of KIVA Spirits. Mishra brings over three decades of extensive experience in the global liquor industry, having held leadership roles at major companies such as Diageo and Pernod Ricard.
Most recently, Mishra served as the Managing Director for Diageo's businesses in Korea and Japan, where he was instrumental in driving growth and providing strategic direction. His tenure at Diageo India included seven years as Chief Commercial Officer and three years as Chief Operating Officer for the West region. Prior to Diageo, he spent 14 years at Pernod Ricard India in various regional and national leadership capacities.
Strategic Expansion and Regulatory Approvals
The move by Varun Beverages, part of the Ravi Jaipuria-owned RJ Corp group, follows regulatory approval to establish the new alcoholic beverages arm. The proposed subsidiary, KIVA Spirits and Company Ltd., will have an authorized share capital of ₹10 crore and a paid-up equity share capital of ₹9 crore, fully owned by Varun Beverages.
This expansion is facilitated by a revised agreement with PepsiCo, which now allows Varun Beverages to diversify into other beverage lines, removing previous operational restrictions. The company's shares reacted positively to the news, closing higher on the BSE.
Broader Diversification Initiatives
Varun Beverages' entry into the alcohol sector is part of a wider strategy to expand its overall beverage portfolio and international presence. Late last year, the company forged a distribution partnership with Carlsberg Breweries in Africa. Furthermore, RJ Corp is reportedly exploring the acquisition of a significant stake in craft beer brand Bira 91, following its founder Ankur Jain's exit.
In parallel, Varun Beverages has also approved the incorporation of a new joint venture in Tunisia. This venture, named Varun Beverages Tunisia SA, will produce and distribute a range of beverages, including carbonated soft drinks, juices, water, and dairy products, with Varun Beverages holding a 75% stake.