MTNL share price hits 20% upper circuit on heavy volumes; up 28% in 2 days

Till 09:43 AM, average trading volume on the counter had jumped over three fold with a combined 21.17 million equity shares, representing 3.4 per cent of total equity of MTNL, changing hands

Mahanagar Telephone Nigam Limited share price (MTNL share price) was locked in the 20-per cent upper circuit, at Rs 57.16 per share, on the BSE today. The rise in MTNL share in Wednesday's intraday trade came was led by heavy volumes. In the last two day, the stock of the state-owned telecom cellular and fixed line services provider has surged 28 per cent.

 

Till 09:43 AM, average trading volume on the counter had jumped over three fold with a combined 21.17 million equity shares, representing 3.4 per cent of total equity of MTNL, having changed hands on the NSE and BSE.

 

MTNL share price news

 

Finance Minister Nirmala Sitharaman, while presenting Union Budget 2025, on February 1, announced a new scheme to provide broadband connectivity to all government secondary schools and health centres.

 

"Broadband connectivity will be added to all government secondary schools and primary healthcare centres in rural areas under the 'Bharat Net' project," the finance minister had said while presenting Budget 2025 in the Parliament.

 

Meanwhile, news reports suggest that the Government will likely allow MTNL and BSNL to monetise their assets.

 

According to a report by Hindi business news channel, CNBC Awaaz, Centre has cleared decks to monetise non-core properties worth Rs 16,000-crore. A Group of Ministers has also waived off various charges and fees on these properties.  READ: Titagarh Rail Systems shares surge 7% on new business plans; details here

 

Business Standard, however, could not verify these reports.

 

MTNL share price history

The stock price of MTNL hit a low of Rs 41.40 on January 28, 2025, and has corrected 59 per cent from its 52-week high level of Rs 101.88, touched on July 29, 2024.

 

On December 17, 2024, CARE Ratings had upgraded long-term debt instruments (bonds issue) of MTNL to 'CARE AAA', and simultaneously removed the 'Rating Watch with Negative Implications' and assigned a 'Stable' outlook.

 

"This rating action follows sustained track record of timely fund infusion by Government of India (GoI) in accordance with the stipulated T-structure payment mechanism (SPM), besides comprehensive understanding of the escrow account’s operational management maintained with Bank of India for servicing Sovereign Guarantee (SG) backed bonds," the rating agency said in its rationale.

 

The outlook for MTNL, thus, is expected to be stable, backed by the expectation of consistent support to be extended by the Government of India. Furthermore, operating in a strategically important sector and support mechanisms such as sovereign guarantees shall ensure timely servicing of the obligations providing stability to credit enhanced ratings.

 

MNTL enjoys a 'Navratna Status' that gives greater autonomy to central public sector enterprises (CPSEs) in their investment and capital expenditure (capex) decisions. Such a status also aims at facilitating expansion of its operations in domestic and global markets, CARE Ratings said.  READ: Tata Power gains 3% post Q3: Analysts split on outlook; should you 'Buy'?

 

In October 2019, considering MTNL's legacy and strategic importance, GoI announced a revival plan for MTNL and BSNL and continued to support the company’s funding requirements through issuance of LoC. To make public sector units (PSUs) financially viable, the Union Cabinet approved a second revival plan for BSNL and MTNL (the telcos) amounting to Rs 1.64 trillion on July 27, 2022. Revival plan is aimed at upgrading services, rolling out 4G services, augmenting the telecom network, and de-stressing balance sheets.

 

As BSNL is handling MTNL's operations, fund infusion per revival package has taken place in BSNL, which is managing combined capex for the telcos. Progress on monetisation of MTNL’s certain identified land assets has also been slow, which has since been transferred from the Department of Investment and Public Asset Management (DIPAM) to the Department of Public Enterprise (DPE), CARE Ratings said.