 "Reliance Communications rallies 19% on back of heavy volumes")
Reliance Communications (RCOM) has rallied 19% to Rs 24.65 on BSE in intra-day trade on the back of heavy volumes.
The trading volumes on the counter more than doubled with a combined 41.03 million shares, representing 1.6% of total equity of RCOM, changing hands on BSE and NSE so far.
Thus far in the calendar year 2017, the stock underperformed the market by falling 29% as compared to 17% rise in the S&P BSE Sensex till Friday, August 11, 2017.
According to reports, the National Company Law Tribunal (NCLT) is set to pronounce its decision on August 14 on whether or not to consider the proposal of merger between RCOM’s wireless business and Aircel.
RCOM and Aircel have already received approvals for the merger scheme from the Stock Exchanges, the Securities and Exchange Board of India (SEBI), the Competition Commission of India (CCI) and the shareholders of both companies.
“As part of this transaction, RCOM’s overall debt will reduce by Rs 14,000 crore, together with transfer of liability for spectrum installments of an additional approximately Rs 6,000 crore,” the company said in press release, while announcing June quarter results.
The company expects to complete merger of Sistema Shyam Telecom by end of this month that will add highly 30 megahertz of premium 850 band spectrums in eight telecom circles. The validity of spectrum in these circles will remain till 2033.
RCOM said it will receive an upfront cash payment of Rs 11,000 crore by sale of its tower business to Brookfield Asset Management. RCOM will also receive a 49% future economic upside in the towers business.
Upon completion of the Aircel merger and sale of the tower business, RCOM’s debt will stand reduced by approx. Rs 25,000 crore, or 60%, it added.
Meanwhile, RCOM has reported a third straight quarter consolidated loss of Rs 1,210 crore in the three-month period ended June 30, 2017 (Q1FY18). It had posted net profit of Rs 54 crore in the same quarter last fiscal.
Consolidated revenues during the quarter under review declined 33% to Rs 3,591 crore over the previous year. EBITDA (earnings before interest, taxation, depreciation and amortization) down 65% year-on-year to Rs 543 crore, consequent to the impact of disruptive pricing and unprecedented competitive intensity in the industry. The EBITDA margin contracted to 15.1%, compared to 29.1% in the corresponding quarter.
The trading volumes on the counter more than doubled with a combined 41.03 million shares, representing 1.6% of total equity of RCOM, changing hands on BSE and NSE so far.
Thus far in the calendar year 2017, the stock underperformed the market by falling 29% as compared to 17% rise in the S&P BSE Sensex till Friday, August 11, 2017.
Also Read
RCOM and Aircel have already received approvals for the merger scheme from the Stock Exchanges, the Securities and Exchange Board of India (SEBI), the Competition Commission of India (CCI) and the shareholders of both companies.
“As part of this transaction, RCOM’s overall debt will reduce by Rs 14,000 crore, together with transfer of liability for spectrum installments of an additional approximately Rs 6,000 crore,” the company said in press release, while announcing June quarter results.
The company expects to complete merger of Sistema Shyam Telecom by end of this month that will add highly 30 megahertz of premium 850 band spectrums in eight telecom circles. The validity of spectrum in these circles will remain till 2033.
RCOM said it will receive an upfront cash payment of Rs 11,000 crore by sale of its tower business to Brookfield Asset Management. RCOM will also receive a 49% future economic upside in the towers business.
Upon completion of the Aircel merger and sale of the tower business, RCOM’s debt will stand reduced by approx. Rs 25,000 crore, or 60%, it added.
Meanwhile, RCOM has reported a third straight quarter consolidated loss of Rs 1,210 crore in the three-month period ended June 30, 2017 (Q1FY18). It had posted net profit of Rs 54 crore in the same quarter last fiscal.
Consolidated revenues during the quarter under review declined 33% to Rs 3,591 crore over the previous year. EBITDA (earnings before interest, taxation, depreciation and amortization) down 65% year-on-year to Rs 543 crore, consequent to the impact of disruptive pricing and unprecedented competitive intensity in the industry. The EBITDA margin contracted to 15.1%, compared to 29.1% in the corresponding quarter.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%