RCom: Turbulence continues





The stock of Reliance Communications (RCom) tanked more than 7 per cent last week. This follows China Development Bank (CDB) filing an insolvency case against the company with the National Company Law Tribunal. RCom is now reeling under debt of ₹45,000 crore and owes about ₹7,500 crore to CDB which, with interest, is about ₹9,000 crore.

Nearly 31 other lenders of RCom have opposed CDB’s move, as it will force them to take a 50 per cent haircut in their books immediately. It may also harm the company’s efforts to monetise assets to pare debt.

The RCom stock has been on a continuous downtrend, accentuated by its failed merger with Aircel. The poor financial performance has compounded the problems. In the September 2017 quarter, the company posted a loss of ₹2,709 crore compared to profit of ₹62 crore in the year-ago period, while revenue declined 49 per cent y-o-y to ₹2,615 crore.

Read the rest of this article by Signing up for Portfolio.It's completely free!

What You'll Get





MORE FROM BUSINESSLINE


 Getting recommendations just for you...
This article is closed for comments.
Please Email the Editor