Rcom has now displaced PNB as the top loser; the battle of the two big losers on the BSE shows how dire the situation is for some of the biggest companies of India.
Rcom slipped down over 17.5% to Rs.10.25, which is just 25 paise short of hitting the 20% lower circuit of Rs.10. Its 52-week low stands at Rs.9.60.
The stock slipped after the National Company Law Tribunal (NCLT) yesterday went ahead and accepted the petition from Ericsson AB, which in short means, NCLT has accepted that Rcom be placed in the insolvency proceedings. Ericsson had petitioned for recovery of Rs.11,600 crore as unpaid dues from Rcom.
Rcom is sure to appeal the verdict with a tribunal in New Delhi but this for now puts in limbo its plans to sell $3.7 billion assets - airwaves, towers and fibre assets, elder brother’s company Reliance Jio Infocomm.
If the NCLT goes ahead with the proceedings, it would mean that there would be a long drawn process, which could take up almost the entire year to work out either a debt repayment plan or liquidate the company.
Let us see how the wind swings in Rcom but for now, the outlook is surely dire.