GNFC turns volatile on facing demand notice for telecom dues

Gujarat Narmada Valley Fertilizers & Chemicals (GNFC) said India's telecom ministry has asked it to pay over Rs 15,000 crore in overdue fees by 23 January 2020.

GNFC will seek legal advice in the matter, which pertains to licenses for satellite phones and internet services held between 2005 to 2019, according to its exchange filing Wednesday.

The notice comes in the wake of Supreme Court's 24 October 2019 judgment in favour of the Department of Telecommunications (DoT) which implied that telecom service providers, internet service providers (ISPs) and virtual network operators, among others, would now need to pay their dues basis a wider definition of adjusted gross revenue (AGR) including non-core items.

GNFC holds V-SAT (Very Small Aperture Terminal) and ISP (Internet Service Provider) licenses.

The GNFC stock hit the day's low of Rs 155.15 in early trade, its lowest intraday level since 20 August 2019. It recovered as the session progressed and was now trading 1.88% higher at Rs 165.15.

The recovery was supported by bargain hunting after the scrip corrected 5.87% in four sessions to end at Rs 162.10 yesterday from its close of Rs 172.20 on 26 December 2019.

On consolidated basis, GNFC reported a 71.5% decline in net profit to Rs 85.07 crore on an 18.8% drop in net sales to Rs 1332.35 crore in Q2 September 2019 over Q2 September 2018.

GNFC is engaged in manufacturing and selling fertilizers such as urea and ammonium nitrophosphate under the umbrella Narmada.

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