NEW DELHI: Shares of Nestle India fell 2.54 per cent in intraday trade on Thursday after the company on Wednesday posted its first loss in over three decades for the quarter ended June as a nationwide ban on its flagship Maggi instant noodles brand disrupted its business.

The FMCG company reported a net loss of Rs 64.4 crore for the April-June period, compared to a net profit of Rs 287.9 crore the year-ago quarter, mainly due to the recall exercise of Maggi that cost it Rs 320 crore.

The maker of KitKat chocolate and Nescafe reported 20% year-on-year fall in its net sales for the second quarter at Rs 1,933.8 crore while its total income decreased 19% at Rs 2,455 crore. “This quarter has been extremely challenging for the company,” Nestle India managing director Suresh Narayanan said in a statement.

On June 5, Nestle recalled its popular Maggi instant noodles brand hours before the national food regulator, Food Safety and Standards Authority of India (FSSAI), banned its sale nationally based on some tests that allegedly found more than permissible levels of lead in the product, alleged mislabelling on packs that declared ‘no added MSG’ and for selling Maggi oats masala noodles without product approval from the regulator.

The company said the issue disrupted its business. In addition to loss of sales, the firm reversed net sales worth Rs 288.4 crore during the quarter in relation to Maggi noodle stocks already sold to retail and withdrawn from the market. It reiterated its products are safe for consumption and that it recalled Maggi because of confusion in the consumer’s mind about its safety following test reports.

“Nestle India would like to reassure consumers that our products are safe,” Narayanan said in the statement. “We are making all efforts and will continue to engage with authorities to bring Maggi noodles back on the shelves,” he said.