McLeod Russel share price gained 5 percent in trade on Monday after IndusInd Bank bought over 70 lakh shares invoking its right to pledged shares of the tea company to recover its dues.

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The stock rose 5 percent to its day's high of Rs 35.10 per share on the BSE.

"The bank had yesterday, June 24, 2021, pursuant to invocation of the pledge of shares, acquired 70,67,500 equity shares of Mcleod Russel India Ltd NSE 5 percent," IndusInd Bank said in a regulatory filing on Friday.

Equity shares of the tea company, held by Ichamati Investments Ltd, were pledged with the bank for securing the outstanding dues of borrower Mcleod Russel India Ltd (MRIL).

Ichamati Investments Ltd held a 16.39 percent stake in Mcleod Russel as a promoter by the end of March 2021, as per data on BSE.

The bank has invoked the pledge held on the shares for recovery of its dues from MRIL, the filing said.

Last year in August, the lender had acquired 7.5 percent (78,32,253 shares) in McLeod Russel India Ltd by invoking pledged shares following default by the borrower.

The Kolkata-based company had reported a consolidated net loss of Rs 52.39 crore in the fiscal ended March 2021. It narrowed from FY20 net loss of Rs 147.79 crore.

—With inputs from PTI

(Edited by : Ajay Vaishnav)