Dabur India and its subsidiaries currently find themselves entangled in lawsuits in the United States and Canada. These legal actions have been initiated by customers who allege that the usage of hair relaxer products has resulted in severe health problems, including ovarian cancer, uterine cancer, and various other health issues.
The repercussions of these legal challenges are beginning to affect Dabur India, as the company's shares experienced a decline of up to 2.5 percent during morning trading on Thursday. As of 12:06 p.m. IST, the shares were down by 1.7 percent, trading at 525 rupees, further contributing to their year-to-date decline of 6.5 percent.
In response to these lawsuits, Dabur India stated that the cases are currently in the pleadings and early discovery phases of litigation. The company emphasized that the allegations are primarily founded on an "unsubstantiated and incomplete" study.
Approximately 5,400 cases have been filed against several companies, including Dabur India's subsidiaries like Namaste Laboratories, Dermoviva Skin Essentials, and Dabur International. These cases have been consolidated into a multi-district litigation proceeding before a U.S. District Court in Illinois. Dabur's subsidiaries have firmly refuted any liability and have taken measures to retain legal representation to defend their positions.
Dabur India, known for its product brands like Vatika Shampoo and Honitus cough syrup, admitted that it is currently unable to ascertain the financial implications that may arise from the settlement or verdict outcomes at this stage. However, the company anticipates that the defense costs will surpass the materiality threshold in the near future.
As of now, Dabur India has not provided additional details beyond the information disclosed during normal business hours.
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