MTNL shares jump 19% in trade; here is what you need to know

As per news reports, the central government is formulating a policy framework to enable the streamlined transfer of immovable assets, such as land and buildings, owned by telecom public sector undertakings (PSUs) like Bharat Sanchar Nigam Limited (BSNL), Mahanagar Telephone Nigam Limited (MTNL), and Indian Telephone Industries (ITI) to various ministries and departments.

The move is aimed at optimising public sector resources, accelerating asset monetisation, and supporting the restructuring efforts of debt-laden telecom PSUs. A high-level meeting chaired by the cabinet secretary on June 12, 2025, concluded with a directive to formulate comprehensive guidelines for the transfer process, news reports added.

This could be attributed to the sharp spike in the share price of MTNL. Publicly available data show that the stock has gained 27% in the past 30 days and over 14% in the past five days.

The initiative is critical, especially for MTNL, as the PSU is facing acute financial distress. The loss-making public sector telecom firm's total debt obligations reached ₹33,568 crore as of March 31, 2025, according to the filing dated April 19.

The total loan default includes ₹3,633.42 crore of debt raised from Union Bank of India, ₹2,374.49 crore from Indian Overseas Bank, ₹1,077.34 crore from Bank of India, ₹464.26 crore from Punjab National Bank, ₹350.05 crore from State Bank of India, ₹266.30 crore from UCO Bank and ₹180.3 crore, along with principal and interest payment.

The defaults in loan payments have occurred between August 2024 and February 2025.

The total debt of the company comprises an ₹8,346 crore bank loan, a ₹24,071 crore sovereign guarantee bond, and a loan of ₹1,151 crore from the Department of Telecom for paying SG bond interest, according to the filing.