By Nandan Mandayam and Rishika Sadam BENGALURU/HYDERABAD (Reuters) -Heineken-owned United Breweries on Wednesday stopped supplying beer to Telangana in southern India, following the state's refusal to allow price rises,

Heineken NV’s Indian unit suspended supply of beer to the southern Indian state of Telangana, citing unprofitable prices and missed payments.

United Breweries highlighted that despite continuous efforts over the past two years, there has been no increase in the base prices of its products since the 2019-20 fiscal year.

United Breweries said on Wednesday that it has suspended supplying beer to a state-run corporation in the southern Indian state of Telangana, which will halt sales of popular beer brands such as Heineken and Kingfisher in one of the country's top liquor-selling states.

United Breweries Ltd has suspended beer supply to Telangana due to owed payments and low state prices. The Telangana Beverages Corporation Ltd and excise department have started rationing beer stocks to depots.

Telangana is India's biggest beer-consuming state, with Kingfisher, including Kingfisher Strong, Kingfisher Ultra, and Kingfisher UltraMax, accounting for around 60 per cent of the total sales. Telangana accounts for around 15-20% of United Breweries’ beer sales and 10%-12% of the company's earnings.

Wednesday's unusual move by India's biggest beer company sparked a fall of 7% in its shares at a time when the industry faces intense scrutiny nationwide