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RCom extends losses after Fitch withdraws rating

Capital Market 

Communications dropped 2.82% to Rs 11.02 at 14:25 on after global credit rating agency, Fitch Ratings withdrew rating of the company and senior secured notes.

The announcement was made after market hours yesterday, 5 December 2017.

Meanwhile, the S&P Sensex was down 158.69 points or 0.48% at 32,644.15. The S&P Mid-Cap index was down 113.06 points or 0.67% at 16,699.01, underperformed the Sensex.

On the BSE, 32.05 lakh shares were traded on the counter so far as against the average daily volumes of 47.04 lakh shares in the past one quarter. The stock had hit a high of Rs 11.35 and a low of Rs 10.93 so far during the day. The stock had hit a 52-week high of Rs 41 on 6 April 2017 and a record low of Rs 9.60 on 15 November 2017.

The stock has dropped 12.53% in four sessions to its ruling price, from a close of Rs 12.60 on 30 November 2017.

The stock had underperformed the market over the past one month till 5 December 2017, falling 32.9% compared with 2.62% drop in the Sensex. The scrip had also underperformed the market in past one quarter, dropping 49.82% as against Sensex's 3.12% rise. The scrip had also underperformed the market in past year, slumping 68.63% as against Sensex's 24.49% rise.

The mid-cap company has equity capital of Rs 1244.49 crore. Face value per share is Rs 5.

Communications (RCom) said that global credit rating agency, Fitch Ratings (Fitch) has withdrawn C rating of company's long-term foreign and local currency issuer default ratings and bonds listed in Singapore stock exchange due to commercial reasons.

The company has already informed all the stakeholders that the lenders of the company have invoked strategic debt restructuring (SDR) scheme as per RBI guidelines and pursuant to the said guidelines; the company is under standstill period till December 2018.

The company has also announced various asset sales and a comprehensive debt resolution plan vide letter dated 30th October 2017. Accordingly, for the time being, no payment of interest and/or principal is being made to any lenders and/or bondholders of the company.

Fitch dropped the company from its analytical coverage on the back of multiple insolvency cases against the telecom operator and its slips in interest payments on its global bond holdings.

Since its merger plans with Aircel plan fell through, five insolvency cases have reportedly been filed against the telecom operator, including by China Development Bank, among the telco's largest lenders.

On a consolidated basis, RCom reported a net loss of Rs 2709 crore in Q2 September 2017, compared with net profit of Rs 62 crore in Q2 September 2016. Net sales declined 48.7% to Rs 2615 crore in Q2 September 2017 over Q2 September 2016.

RCom is an integrated telecommunications service provider.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, December 06 2017. 14:31 IST
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