ROME, Oct 15 (Reuters) - Shares in Leonardo rose as much as 3% in early trade on Friday a day after falling when Boeing said parts supplied by the Italian defence group sourced from a sub-contractor had been improperly manufactured.

Leonardo fell more than 7% on Thursday.

The state-controlled conglomerate said the sub-contractor, Italy's Manufacturing Processes Specification (MPS), was among sub-suppliers qualified by Boeing.

"The sub-supplier is under scrutiny by prosecutors therefore Leonardo is an injured party and will not bear any potential costs associated with this issue," Leonardo said on Thursday.

It said MPS was no longer one of its suppliers.

MPS has worked for a broad set of aerospace companies including Spirit AeroSystems, according to industry sources and documents.

It is also an approved supplier to Airbus, according to a list available via the planemaker's website.

"The reaction of the shares already prices in the potential risk of non-recurring expenses, but the reputational problem for (Leonardo's) Aerostructures division remains," broker Equita said.

The division is already suffering from a fall in demand and is expected to burn through cash this year as some of plants operate below capacity.

Shares in Leonardo were up 1.1% at 0833 GMT, outpacing a 0.6% rise in Italy's blue-chip index FTSE MIB. (Reporting by Francesca Landini and Giulia Segreti; editing by Jason Neely)