MTNL’s 25% stock surge signals relief, not revival

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Subscribe to enjoy similar stories. Shares of Mahanagar Telephone Nigam Ltd (MTNL) have soared 25% in just a few days, but this isn’t a sign of a turnaround—it’s a rally driven by relief. Investors are cheering yet another government intervention to keep the struggling state-owned telecom operator afloat.

But beneath the short-term optimism lies a deeper crisis: mounting debt, a shrinking market share, and a legacy of financial mismanagement that has left MTNL on life support. Read this | As MTNL turns NPA for several banks, govt asks lenders to hold off on insolvency This isn’t the first time a bailout has sparked a fleeting stock surge, only to be followed by a harsh reality check. As India’s telecom sector consolidates, private players are raising tariffs and strengthening profitability, while Bharat Sanchar Nigam Ltd (BSNL) and MTNL remain dependent on government lifelines.

Now, with the latest asset monetization plan in motion, the question remains—will this finally break MTNL’s cycle of decline, or is it just another temporary fix? MTNL, a subsidiary of BSNL, is weighed down by a ₹32,000 crore debt burden, the result of 15 years of continuous losses. The crisis has deepened to the point of loan defaults, with ₹7,000 crore owed to lenders such as Union Bank of India, State Bank of India, and Punjab National Bank now classified as defaults. Once a dominant force in Indian telecom, MTNL thrived in the 1990s as the sole provider of telephone services.