Dabur, Britannia: FMCG stocks trade lower amid this negative development; check details

In the early trade, the NIFTY FMCG index was trading 0.55% lower at 56,645.65 levels. Among individual names, shares of Dabur were trading over 1.3% lower at ₹536.90 apiece on the NSE, while Britannia shares were down over 1%. ITC was down 0.14%.

Food and bakery company Britannia Industries said it has temporarily halted production.

"Safety of our people is of utmost importance, and we have temporarily halted all our operations to ensure the same," said a Britannia spokesperson, as reported by PTI.

The company, which owns brands such as Good Day, Marie Gold and Tiger, further said, "We are also grateful for the local military who have stepped in today, boosting the confidence in safety among employees."

While Dabur, which operates a production unit at Birganj in Nepal, said its production has been partially impacted, as many of the workers are not able to reach the plant.

"We are closely monitoring the evolving situation in Nepal. The safety and well-being of our employees, partners, and communities remain our highest priority. We have asked all employees in Kathmandu to operate from home, and the sales teams have also been advised to prioritise safety and adhere to local curfew directives," said a Dabur spokesperson.

The Nepal market accounts for under 3% of Dabur's consolidated sales.

"We are actively coordinating with local authorities and internal teams to ensure business continuity. We remain committed to supporting our employees and partners during this challenging time," the Dabur spokesperson said.

In Nepal, deadlock over the selection of an interim head to run the government continued on Thursday, even as President Ramchandra Paudel appealed for peace and said he was aiming to find a solution to the political crisis within the constitutional framework.

The army took control of security from Tuesday night after incidents of arson and vandalism across the country.

On Tuesday, Nepal Prime Minister K. P. Sharma Oli stepped down shortly after hundreds of agitators entered his office shouting slogans, demanding his resignation for the death of at least 19 people in police action during protests on Monday, officials said.

Almost a year back, Indian FMCG companies faced a similar situation in Bangladesh, when student unrest led to the ouster of the Sheikh Hasina government. Companies such as Emami have reported an impact on their business.

Indian FMCG firms, including Dabur, Britannia, Marico, Patanjali, ITC, and Reliance Consumer, have a significant presence in Nepal. Most of them operate through their local distributors or partnerships.

Some of the firms, such as Dabur, ITC (through Surya Nepal), and Britannia, have their manufacturing operations in Nepal.

Meanwhile, Union Minister Chirag Paswan on Thursday urged food processing industry leaders to pass on the benefits of the rationalisation in GST rates being implemented from September 22 to consumers.

Addressing an interactive meeting with the CEOs from top FMCG firms, organised by CII, the Minister for Food Processing said the GST reforms will enable the sector to grow further and benefit families as well as farmers.

"The food processing sector impacts every single household, and with these tax reductions, not only will every single family be positively affected, but also the farmers. The sector will get an opportunity to grow. The informal sector will have more possibilities to get formalised," Paswan told reporters.