Debt-laden Reliance Communications' (RCom) shares plunged by more than half to a record low on Monday, after the telecom company said it will seek a fast-track resolution to its indebtedness through the bankruptcy court, National Company Law Tribunal. On the National Stock Exchange (NSE), RCom shares finished the session at Rs 7.55 apiece, down 34.9 per cent from the previous close of Rs 11.60.
In one of the country's most high-profile bankruptcy filing cases, RCom said lack of regulatory approval for asset sales as well as cases pending at the Supreme Court and Telecom Disputes Settlement and Appellate Tribunal (TDSAT) resulted in its decision to approach the National Company Law Tribunal (NCLT).
Mumbai-based RCom also said its lenders had not received any proceeds from asset monetisation plans, and that its overall debt resolution process had not made any progress.
Competition in the country's telecoms industry has stepped up several levels since the 2016 entry of cut-price player Reliance Jio Infocomm, leading to RCom shutting down its wireless communications business. Reliance Jio is owned by Mukesh Ambani, the elder brother of RCom owner Anil Ambani.
RCom has been left owing banks $7 billion as of March 2017 when it last made its debt level public, and more to vendors.
It had agreed to sell assets to Jio and Canada's Brookfield Asset Management Inc and use the proceeds to pay off dues owed, including to Swedish telecom equipment maker Ericsson. However, it has not yet received approval from the telecom ministry to proceed with any sale.
Under the court-led restructuring, which it aims to complete within 9 months, RCom said on Sunday it will continue to pursue the sale of all telecom infrastructure assets and spectrum, seek to monetise its assets and sell and develop real estate.
Ericsson declined to comment on Monday. Jio, Brookfield and the Department of Telecommunications could not be reached for comment.
RCom shares plunged as much as 54.3 per cent to an intraday low of Rs 5.3 apiece on Monday. The stock has shed 19.4 per cent so far this year as of Friday's close.
RCom was worth Rs 1.69 lakh crore ($23.6 billion) at its peak in 2008. It is now worth less than $330 million.
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