June 29 (Bloomberg) -- Gildan Activewear Inc. had the biggest drop in four months on concern its production of clothing will be hurt by coup in Honduras.

Gildan, North America’s biggest T-shirt maker, produces about 60 percent of its activewear and half of its socks in Honduras, analysts at TD Securities Inc. said in a June 26 report. They said the stock may decline in the “near term” from “instability” in the country.

Gildan fell the most on the Standard & Poor’s/TSX Composite Index, losing 9.7 percent to C$16.82 at 4:10 p.m. in Toronto Stock Exchange trading. The decline is the steepest intraday retreat for the stock since Feb. 12. The Montreal-based company said in a statement the military coup and ousting of Honduran President Manuel Zelaya hasn’t affected its operations or employees.

Zelaya was overthrown by the military yesterday in a showdown over a referendum on term limits. The coup, the first in Latin America since a two-day ouster of Venezuelan President Hugo Chavez in 2002, was condemned by the U.S. and European Union. The Organization of American States said it won’t recognize a new government.

To contact the reporter on this story: Lynn Thomasson in New York at lthomasson@bloomberg.net.

Last Updated: June 29, 2009 17:07 EDT