West Ham hinted they were prepared to pay a near club-record fee for the France Under-21 striker in an article on their official website last week but Celtic have not received any official bid - and would not welcome one at the sum suggested by the Hammers.
The 20-year-old has scored 19 goals since arriving from Fulham in the summer on a four-year contract and Celtic manager Brendan Rodgers has previously stated he would not be sold in January.
When asked about West Ham's interest, Davies said: "That was definitely well below his valuation, that's for sure. The manager spoke pretty clearly on that situation previously.
"There has been no formal bid or anything like that. It is at the moment speculation but it's well below the valuation of the club.
"The message has been pretty clear from the manager, he spoke about it last month. For us, we know this is the best place for Moussa to develop and improve. He is still 20 years old, he has development left in him.
"He has had a fantastic first six months, he has absolutely loved it and there is so much more to come from us as a team and for Moussa Dembele at Celtic. That's what we are concentrating on.
"Obviously, when you are doing well and especially when you are a striker, then there is going to be big money and talk thrown about a lot, especially during transfer windows. But we can't control that, we just have to concentrate on trying to develop him as a player."