'Honey' Trap? Dabur clarifies on presence of cancer causing chemicals in product, says report motivated, baseless
New Delhi: Terming the claim as "motivated" and "baseless", Dabur India Ltd has junked the report about the presence of cancer-causing substance in its honey and clarified that every batch of honey that the company produces, complies with FSSAI standards.
The Dabur Honey and Chyawanprash maker's revenue in April-June rose nearly 11% to 31.30 billion rupees, led largely by growth in its consumer care business. Honey products contribute 6–7% to Dabur's revenues in India.
However, the stocks of Dabur hit an eight-week low on Thursday after reports claimed the presence of carcinogenic materials in its honey product.
The controversy erupted after a recent Zee News report claimed that high concentration of carcinogenic material was allegedly found in the popular brand Dabur Honey. The samples of Dabur Honey were tested at the Centre for Analysis and Learning in Livestock and Food at the National Dairy Development Board in Gujarat.
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However, Ankush Jain, CFO, Dabur India said, “We heard this news and we would want to say that we stand by the purity of Dabur honey. Every batch of Dabur honey which is produced in any of the factories complies with all the FSSAI standards and both at the time of receipt of the raw material and also post-refineralisation or packaging of the final product. ”
"This seems to be a very motivated report," Jain added.
The CFO also stated that the company has recently got an EGGMARK special note certification. “All our honey are manufactured in US FDA-certified facilities. And we can say with certainty that this is the purest honey Dabur makes in India,” he added.
Dabur India, which sells Vatika Shampoo and Honitus cough syrup brands, reported a rise in first-quarter profit on Thursday. The company's consolidated net profit rose 5.4% year-on-year to Rs 464 crore in the quarter ended June 30.
"With inflation softening, we have seen our rural growth bounce back to high single digits after three quarters," Chief Executive Mohit Malhotra said in a statement, adding that rural demand lags the urban segment.
The company's consumer care business accounts for more than three-fourths of its revenue. Growth in categories outside food and beverage, such as hair oils and shampoo, is better than the company's rivals that have reported so far, Shirish Pardeshi, Centrum research analyst told BQ Prime.
He added that Dabur's overall revenue was impacted by unseasonal rains that hit the company's juice business and slow recovery in the rural economy.
Meanwhile, Honey products contribute 6–7% to Dabur's revenues in India, Abneesh Roy of Nuvama Wealth Management writes in a note. "We don’t expect a big impact on honey sales over longer term," Roy told BQ Prime, adding that in the short-term sales may face a “small impact”
