(Yicai Global) Nov. 28 -- Shares in China's biggest food and drinks producer Master Kong Holdings dived more than 17.7 percent yesterday, sparking its biggest fall in 20 years after it posted a decline in third-quarter revenue.

Shares in the company [HKG:0322], officially Tingyi Holding, slumped to HKD10.48 (USD1.34) at the close, wiping HKD12.6 billion (USD1.6 billion) from its market cap. The stock recovered 4 percent to HKD10.9 in today's trading.

The Tianjin-based firm's third-quarter revenue fell 4.2 percent on the year to CNY19 billion (USD2.7 billion), though net profit rose by more than a quarter to CNY1.6 billion. Revenue over the first nine months was up 3.3 percent at CNY50 billion and net profit was up 47.6 percent at CNY2.9 billion.

Several investment banks have since lowered their investment ratings for the company, which had tried to ramp up revenue by raising prices and spending more on marketing.

Master Kong began making instant noodles in 1992 and listed in Hong Kong four years later. Despite remaining China's biggest food and drinks maker, its market share in many of its top segments has fallen over recent years. Its share of the instant noodles sector, by sales, fell to 48.8 percent in the second quarter of this year compared with 57.1 percent in the same period of 2014.

The firm blamed the latest quarter's falling revenue on sales of instant noodles and beverages -- its two main sectors. Sales over the first three quarters increased for both but fell by 6.5 percent for soft drinks, slashing the firm's revenue in the category by CNY816 million (USD117 million).

Weather during the third quarter, which is supposed to be peak period for drinks sales, was hotter than usual. Master Kong's carbonated drinks sold well, but tea and juice drinks struggled and revenue from bottled water declined.

Editor: James Boynton