Traded volume surged to 311.13 lakh shares with a turnover of ₹1,333.90 crore, suggesting heavy institutional activity.
Shares of Varun Beverages closed sharply lower on Wednesday, falling ₹16.75 or 3.82 per cent to ₹421.25, even as the PepsiCo bottler announced a sweeping strategic expansion into alcoholic beverages and a new overseas joint venture. Traded volume surged to 311.13 lakh shares with a turnover of ₹1,333.90 crore, suggesting heavy institutional activity. The stock opened at ₹447.90, hit a high of the same level, before sliding to a low of ₹420.20, nearly touching its lower band.
The board approved incorporation of KIVA Spirits and Company Limited, a wholly-owned Indian subsidiary, to pursue the Ready-to-Drink (RTD) and alcoholic beverages segment. Prathmesh Mishra, formerly Managing Director for Korea and Japan at Diageo, was appointed CEO and MD of the new entity. The board also cleared a joint venture in Tunisia, Varun Beverages Tunisia SA, to produce carbonated soft drinks, juices, water and dairy, with VBL holding 75 per cent and local partner Bevanda holding the remaining 25 per cent.
Analysts were broadly constructive but cautious. JPMorgan (Overweight, TP ₹530) flagged that investors will seek clarity on manufacturing versus distribution strategy, potential M&A, capex needs and target segments. CLSA (High Conviction Outperform, TP ₹629) was more bullish, noting India’s alcobev market is estimated at roughly $50.8 billion with strong premiumisation tailwinds. Morgan Stanley (Overweight, TP ₹557) noted the move aligns with management’s October 2025 commentary on RTD opportunity.
Despite analyst optimism, the stock’s near-term performance remains under pressure. VBL is down 14.34 per cent year-to-date and 17.17 per cent over the past year, underperforming the Nifty Next 50 significantly. Its 52-week high stands at ₹555.80. Both subsidiaries remain subject to regulatory approvals before operations commence.
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