Welspun India tanks 20% amid reports Target severs biz ties

Shares of textiles manufacturer Welspun India dived 20 per cent, wiping-out Rs 2,064 crore from its market valuation today, amid reports that Target Corp is in the process of terminating business ties with the firm.
Reacting to this, the scrip tanked 19.98 per cent to settle at Rs 82.30 -- its lower circuit limit -- on BSE.
At NSE, shares of the company dipped 19.96 per cent to end at Rs 82.60.
Led by the sharp fall in the stock, the company's market valuation plummeted by Rs 2,064.11 crore to Rs 8,268.89 crore.
As per the reports, US-based Target is Welspun's second- biggest customer.

Target said that Welspun substituted Egyptian cotton with a cheaper variant of cotton while supplying it bedsheets, the reports noted.
Meanwhile, in a BSE filing on Saturday, Welspun India had said, "We refer to a product specification issue with one client program of our subsidiary WGBL. We have initiated immediate actions to investigate the root cause. We are appointing an external auditor (one of the Big Four) to audit our supply systems and processes."
This is an issue of highest priority for us and we will take all necessary steps to address it. We have an impeccable record of supplying quality products to our customers globally tor over two decades. We reiterate our commitment to the highest standards of customer service and compliance, it added.