MTNL shares soar 16% on buzz of merger talks with BSNL
Shares of MTNL on Wednesday zoomed 16 per cent, adding Rs 221 crore to its market valuation, following reports of a renewed discussion of its merger with BSNL. The stock soared 16.04 per cent to end at Rs 26.05 on BSE. During the day, it jumped 18 per cent to Rs 26.50 -- its 52-week high. At NSE, shares of the company surged 15.52 per cent to close at Rs 26.05.
Led by the sharp rally in the stock, the company's market valuation rose by Rs 221.15 crore to Rs 1,641.15 crore. On the volume front, 55.35 lakh shares of the company were traded on BSE and over two crore shares changed hands at NSE during the day.
After a hiatus of few years, the proposal to merge state-run telecom firms BSNL and MTNL is back on the discussion table with top officials at the telecom department once again 'brainstorming' on various options concerning the two loss-making entities.
According to a highly-placed source in the Department of Telecom, a top-level meeting recently discussed possibility of merging both the entities that are facing financial stress due to increasing competition in the sector.
MTNL's standalone net loss has widened to Rs 819.96 crore, surpassing its total revenue, during the three-month period ended December 31, mainly hit by finance cost.
The net loss surpassed its total income of Rs 690.59 crore. The losses of BSNL have, however, narrowed to Rs 4,890 crore for the April-December period of the current fiscal, from Rs 6,121 crore in the year-agoperiod.