Som Distelleries shares decline over 16% today; What drove the downward trend?

Shares of Som Distilleries and Breweries plummeted by 16 per cent during early trade on June 18, following the National Commission for Protection Of Child Rights (NCPCR) revelation that it discovered 50 children working at the company's plant in Madhya Pradesh.

However, the company has denied direct involvement in employing child labour, attributing responsibility for the incident to a private contractor.

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The chairperson of NCPCR disclosed that 58 children, including 20 girls, were found at the plant. He further stated that many of the children had suffered burns on their hands due to exposure to chemicals.

“Yesterday afternoon, during an inspection in Madhya Pradesh's Raisen district, we found 39 boys and teenagers employed in the liquor manufacturing work at the Som Distillery who had disappeared from the factory late in the evening,” NCPCR said in a post on social media X.

However, the company has denied responsibility for employing child labour, attributing the incident to a private contractor.

"We wish to clarify that these concerns are not related to Som Distilleries and Breweries Limited but relate to our associate Private Limited company which deals in country liquor primarily, and not the listed company as reported," the company said.

In the last one year, Som Distilleries' stock has increased by 13 per cent, which lags behind the Nifty 50 benchmark index, which rose approximately 26 per cent over the same period.

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Som Distilleries and Breweries, based in Bhopal and promoted by Som Group, is a prominent player in the Indian alcoholic beverages sector. The company specialises in brewing beer and blending and bottling Indian-made foreign liquor. It boasts a robust sales and distribution network with distributors spanning across several states in India, including Andhra Pradesh, Chhattisgarh, Jharkhand, Madhya Pradesh, Maharashtra, Odisha, Karnataka, Kerala, and West Bengal.