- Shares of Dabur India Ltd. fell over 2% after FSSAI banned some product sales.
- FSSAI cited misleading 100% claims violating advertising and labelling rules.
- The ban includes honey, oils, ghee, coconut water, and other food items.
Shares of Dabur India Ltd. dropped over 2% in early trade on Tuesday, Aug. 4 after the Food Safety and Standards Authority of India (FSSAI) directed the leading FMCG major to immediately stop selling a range of food products carrying what it described as misleading "100%" claims, citing violations of advertising and labelling regulations.
Dabur India's share price has faced downward pressure recently due to a combination of underwhelming volume growth in its latest quarterly results, broader macroeconomic headwinds, and structural valuation adjustments.
The prohibition order covers products including honey, apple cider vinegar, virgin coconut oil, sesame oil, cow ghee, coconut water, coconut milk and other food items marketed with claims such as "100% Natural", "100% Pure", "100% Purity Guaranteed", "100% Organic" and "100% Tender Coconut Water".
The FMCG sector at large is grappling with demand challenges. While Dabur has seen resilient rural demand, urban consumption has not yet recovered meaningfully enough to offset broader market pressures. Additionally, the company is navigating ongoing inflationary pressures, volatile commodity prices, and geopolitical uncertainties in the MENA region, which are weighing heavily on investor sentiment across the consumer goods sector.
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