Shares of United Breweries (Holdings) plummeted by more than 10 percent on the Bombay Stock Exchange (BSE) Tuesday, after the company said in a regulatory filing that state-owned Punjab National Bank (PNB) has declared it "wilful defaulter".
The stock was trading at Rs 20.10, down 11.45 percent from its previous close, at around 1.50 p.m.
The company said it would contest the tag.
"The Company is in consultation with its legal counsels to challenge the decision by taking appropriate legal action that may be required in this regard," UB (Holdings) informed the BSE on Tuesday.
The bank's move is in relation to the Rs 800 crore debt taken by the company from PNB for another group venture, Kingfisher Airlines, reports Mint.
The Vijay Mallya-owned company reported a net loss of Rs 16.31 crore for the quarter ended December 2015, as against a profit of Rs 2.02 crore in the corresponding quarter last fiscal, despite income from operations rising 19.4 percent to Rs 104.52 crore from Rs 87.57 crore in the year-ago period.
Lenders comprising SBI, IDBI Bank, Bank of India, Corporation Bank, State Bank of Mysore and other institutions including some private sector banks have an exposure of about Rs 6,300 crore to UB (Holdings).
A few days ago, SBICAP Trustee Co., a wholly-owned subsidiary of investment bank SBI Capital Markets Ltd (SBI Cap), initiated the process to sell Kingfisher House, the head office of Kingfisher Airlines.
Promoters including Vijay Mallya held about 52 percent stake in UB (Holdings) as on Dec.31, 2015, according to the company's regulatory filing on Jan.22, 2016.