Even as the broad market trend displays a steady positive movement, shares of Jubilant Foodworks Westlife Development and Britannia Industries faced frenzied selling from investors, tumbling 1-10%. The sharp fall was mainly due to a government study that revealed use of potassium bromate and potassium iodate by the bread industries which contains cancer-causing chemicals.
Among the major laggards, shares of Jubilant Foodworks tumbled 9 percent to trade at Rs 1,012.90, after falling to as much as Rs 975 in early trades, down over 12 percent.
Similarly, shares of Westlife Development cracked 9% to a low of Rs 200 before erasing most of its losses to trade a percent lower at Rs 217.90.
Britannia Industries also came under selling pressure and lost nearly 2 percent to Rs 2,630 after falling to a low of Rs 2,611.20 a short while ago.
A report by NGO Centre for Science and Environment (CSE) said that nearly 84 per cent of 38 commonly available brands of pre-packaged breads, including pav and buns, tested positive for potassium bromate and potassium iodate, banned in many countries as they are listed as "hazardous" for public health.
"A scientific panel had recommended removal of potassium bromate from the list of additives. So we have already decided to take it out from the list. Soon it will be notified," said Food Safety and Standards Authority of India (FSSAI) CEO Pawan Kumar Agarwal.
According to sources, in January FSSAI had decided to remove potassiun bromate from food additives list and had even issued a draft notification.
According to CSE, potassium bromate typically increases dough strength, leads to higher rising and uniform finish to baked products, while potassium iodate is a flour treatment agent.
However, companies engaged in manufacturing breads and breakfasts have denied using these chemcials.
A DNA report quoting Britannia in a statement said "it does not use Potassium Bromate or Iodate as an ingredient in any of its bread recipes. All Britannia Breads products are in 100 per cent compliance to the existing food safety regulations as stipulated by FSSAI."
It added "FSSAI stipulates usage of all Food Additives in Food Products within per permissible limits. For potassium Bromate/Iodate FSSAI stipulates the permissible limit as 50 ppm max (On flour mass basis)."
The statement made it a point to mention both things, that Britannia does not use the substance at all, and that 50 ppm was the permissible limit set by the Food, Safety and Standards Authority of India.
"We have not seen the report of CSE on presence of potassium bromate in different bread brands collected by them from Delhi market about a year back (May 2015). Only after going through the contents of the report in detail, we will be able to give our response and considered views regarding this issue," a Times of India report said quoting statement of Mago.
Reacting to the CSE report, Health Minister J P Nadda said, "We are seized of the matter. I have told my officials to report to me on an urgent basis. There is no need to panic.
Very soon we will come out with the (probe) report." In its report, CSE claimed that while one of the chemicals is a category 2B carcinogen (possibly carcinogenic to humans), the other could trigger thyroid disorders but India has not banned their use.
With PTI inputs
Updated Date: May 24, 2016 10:44 AM