GTL, GTL Infra tank upto 20% as company cuts outlook on Aircel insolvency

GTL Infra locked in lower circuit of 20% at Rs 3.11, while GTL hit a record low of Rs 9.60 on the BSE.

Shares of GTL and GTL Infrastructure have tanked up to 20% on the BSE after the Global Group firms warned that its operations will be hit with the shutdown of multiple telecom players and filing of bankruptcy petition by Aircel early this month.

GTL Infra is locked in lower circuit of 20% at Rs 3.11, hitting a multi-year low on the BSE, with no buyers were seen on the counter. The trading volumes on the counter more than doubled with a combined 15 million shares changed hands and there were pending sell orders for 9.48 million shares on the NSE and BSE at 09:53 am.

GTL hit a record low of Rs 9.60, down 13% on the BSE in early morning trade. The stock is currently trading 4% lower at Rs 10.60, with a combined 205,913 shares changed hands on both the exchanges.

GTL Infra has lowered its consolidated revenue and earnings before interest, tax, depreciation and amortization (EBITDA), by 12% and 28% respectively for the year ending March 2018.

In the event no revival is possible and Aircel becomes insolvent, the Company would lose all 23,727 of Aircel's tenancies. As a result thereof, the Company's tenancies will likely to close at 26,639 as on March 31, 2018 as against 51,587 tenancies as of December 31, 2017, GTL Infra said in a regulatory filing.

Given that Aircel contributed 43% of the revenues of the Company as on March 2017, the impact of Aircel's insolvency will be materially adverse for the Company, it added.

GTL Infra said if Aircel were to become insolvent and consequently terminate contractual arrangements for all tenancies, the Company's dues which would have been recoverable from Aircel for the remainder of the contractual term would be Rs 127 billion (including the six circles).

Since Aircel is now before the National Company Law Tribunal, Mumbai (NCLT) and the Company is an unsecured operational creditor, it remains to be seen what residual value would be left for distribution after appropriation by the secured banks / lenders. In the event of liquidation, initial third party estimates suggest that there may not be any monies left after distributing proceeds to the secured banks / lenders of Aircel, it added.

The public sector banks led by Central Bank of India and Union Bank of India total 15 banks and financial institutions held 63.16% stake in GTL Infra, while these entities held 37.96% stake in GTL, the shareholding patter data shows,