Dabur India Shares Plunge Amid Q2 Sales Announcement

Shares of Dabur India Ltd fell nearly 8% after the company announced a drop in profitability due to weather-related sales impacts in Q2. The primary sales slump is linked to inventory corrections in the general trade channel, while international operations show double-digit growth.

Shares of FMCG giant Dabur India Ltd witnessed a significant drop of nearly 8% on Thursday following the company's revelation of profit challenges in the second quarter. The plummet comes as primary sales were hampered by adverse weather conditions, including heavy rain and floods in parts of India, which affected out-of-home consumption and consumer offtake.

The company's stock dropped 7.69% to Rs 571.25 on the BSE, and by 7.75% to Rs 571 on the NSE. Dabur India, in its quarterly update, informed bourses of an anticipated mid-single-digit decline in consolidated revenue for Q2, primarily due to corrections in distributor inventory within the general trade channel.

Dabur emphasized that while the demand trends showed improvement, extreme weather severely impacted sales, particularly in the beverage sector. To address inventory issues, the company made a strategic decision to correct inventory levels, boosting long-term business health despite the temporary revenue decline. The international sector, however, continues to experience robust double-digit growth.