Som Distilleries plummets 16% on child labour concerns

Over the past year, Som Distilleries shares gained around 20 percent.

Som Distilleries and Breweries shares crashed 16 percent in early trade on June 18, after the National Commission for Protection Of Child Rights (NCPCR) announced it found 50 children working at the firm's Madhya Pradesh plant.

However, the firm has denied responsibility for employing child labour, instead said a private contractor was accountable for the mishap.

The NCPCR chairperson announced that 58 children, including 20 young girls, were found at the plant. As a result of being in contact with chemicals, the skin was burned off many children's hands, he added.

The commission has filed a case against the firm under juvenile justice and bonded labour laws.

At 9.35 am, shares of the alcohol maker skid 13 percent to Rs 108.24 apiece on the NSE.

“The case of child labour during a raid on a factory in Raisen district has come to my notice. This matter is very serious. In this regard, detailed information has been obtained from the officials of Labor, Excise and Police departments and instructions have been given for appropriate action. Strictest action will be taken against the culprits,” the Madhya Pradesh Chief Minister’s Office said on social media platform X.

In an exchange filing, Som Distilleries and Breweries clarified that the concerns are not related to Som Distilleries and Breweries, but with a private associate, which deals in country liquor.

Som Distilleries blamed private contractors for the mishap, saying they might have not have conducted the age verification process thoroughly.

"The company has extended full cooperation to the authorities regarding the issue, and [has] terminated the services of the vendor," added the liquor-maker.

Over the past year, Som Distilleries shares gained around 20 percent, underperforming the benchmark index Nifty 50, that rose around 25 percent during the same time period.