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Delhi government bans Maggi for 15 days

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Delhi government bans Maggi for 15 days
 
New Delhi, June 3 The Delhi government on Wednesday banned Maggi noodles for 15 days.

Health Minister Satyendra Jain said the government has asked Maggi producer Nestle to recall all samples of the noodle brand from the national capital.

Nestle India stocks down over nine percent

The controversy surrounding its best-seller brand Maggi noodles heavily dented the stocks of fast moving consumer goods (FMCG) major Nestle India, declining by 9.05 percent or 616.35 points at Rs.6,191.10 per equity share from its previous close of Rs.6,807.45.

"The maggie issue has dented the stock heavily. The stock is generally an out performer even when the markets are down. When ever this controversy is resolved then we can see the valuations again rise," said Vinod Nair, head for fundamental research, Geojit BNP Paribas Financial Services.

"But for short-to-medium term there will be a downward trend. However, long-term investors do not need to be worried as the stock still remains very attractive."

Nestle continues to maintain that its product was "safe" for consumption, and that reports of its samples testing positive for higher-than-permissible levels of some substances has created concerns in the market.

Several states have sent the product for testing for higher-than-permissible levels of some substances like 'Lead'. Some major departmental stores across the country have take-off the product from its shelves.

The Delhi state government has banned Maggi noodles for 15 days.