Patanjali Foods Share Price in Focus As Patanjali Ayurved Faces Government Scrutiny for "Dubious" Financial Transactions

Patanjali Foods share price was down 4.04% on Friday at 2:31 PM and was trading at ₹1,686.20. This followed news of Patanjali Ayurved Ltd receiving a notice from the Ministry of Corporate Affairs. The consumer goods and traditional medicine company co-founded by yoga guru Ramdev has been asked to explain a series of financial transactions that federal economic intelligence agencies have flagged as "abnormal and dubious".

This latest development comes as part of a preliminary investigation into potential fund diversion and breaches of corporate governance within the company. While specific figures have not been disclosed, Patanjali Ayurved has been given roughly two months to respond to the ministry's queries.

A Pattern of Regulatory Challenges for Patanjali Ayurved

The current probe adds to a growing list of regulatory hurdles and legal battles for Patanjali Ayurved and its associated companies. The firm has been under the scanner for some time now.

Last year, a unit of Patanjali received show-cause notices concerning alleged tax violations and claims for wrongful refunds. More prominently, the company has faced significant criticism and legal action for promoting misleading advertisements. These ads often promised cures for serious medical conditions like cancer, drawing sharp rebuke from authorities.

Misleading Advertisements and Supreme Court Intervention

The Supreme Court has previously stepped in, restricting Patanjali from advertising its products as cures for various ailments. This action was taken due to violations of the Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954.

Adding to the legal pressure, the Kerala Drugs Control Department reported 26 active cases against Ramdev and Patanjali in February 2025, all under the same advertisement law. Even newspapers that published these controversial advertisements are now facing legal proceedings.

Impact on Patanjali Foods Share Price

While Patanjali Ayurved is a privately held company, its publicly traded subsidiary, Patanjali Foods Ltd, has not been immune to the increased scrutiny. The ongoing investigations and negative headlines appear to be taking a toll on investor confidence, with Patanjali Foods share price dropping nearly 10% so far this month.

Read more on: Reliance Power Shares Hit 52-Wk High on May 30; Up for 2nd Straight Day After Solar Order Win 

Conclusion 

Patanjali Ayurved's continuous run-ins with regulatory bodies highlight the challenges faced by companies operating in the traditional medicine sector, particularly concerning advertising and financial transparency. The outcome of the current probe by the Ministry of Corporate Affairs will be keenly watched, as it could have further implications for the company and its market standing. 
 
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.