Synopsis:
MTNL has defaulted on Rs. 8,585 crore loan payments to seven major public banks, amid a total debt of Rs. 34,484 crore, highlighting its ongoing financial distress and mounting repayment challenges.
During Wednesday’s trading session, shares of this state-owned telecommunications company are in focus on stock exchanges, after the company mentioned defaulting on Rs. 8,585 crore loan payments to seven banks, including SBI, PNB, and Union Bank of India.
With a market cap of Rs. 3,185 crores, shares of Mahanagar Telephone Nigam Limited hit an intraday low at Rs. 49.41 on BSE, down by nearly 1 percent, as against its previous closing price of Rs. 49.92. The stock has delivered negative returns of over 5 percent in one year, and has fallen by nearly 2 percent in the last one month.
What’s the News
As per the latest regulatory filings, MTNL has defaulted on both principal and interest payments to seven major public sector banks: Union Bank of India (UBI), Bank of India (BOI), Punjab National Bank (PNB), State Bank of India (SBI), UCO Bank, Punjab & Sind Bank (PSB), and Indian Overseas Bank (IOB). The total amount of outstanding borrowing from these banks stands at Rs. 8,585 crores.
Beyond its bank borrowings, MTNL’s total financial indebtedness, including short-term and long-term debt, amounts to Rs. 34,484 crores. This includes a bank loan of Rs. 8,585 crores, SG Bonds worth Rs. 24,071 crores, and a Rs. 1,828 crore loan from the Department of Telecommunications (DoT) to cover SG Bond interest payments.
The company’s defaults didn’t happen all at once. The defaults took place between August 2024 and February 2025, with the overdue principal payments totalling Rs. 1,868.61 crores, along with overdue interest of Rs. 790.59 crores.
This isn’t the first time MTNL has struggled to meet its debt obligations. Back on March 15th, it had defaulted on both principal and interest payments to these same seven banks, when its total outstanding borrowing stood at Rs. 8,277 crore.
Financials
MTNL reported a decline in revenue from operations, experiencing a year-on-year fall of nearly 19 percent, from Rs. 209 crores in Q4 FY24 to Rs. 170 crores in Q4 FY25.
Similarly, the company’s net loss widened from Rs. 784 crore to Rs. 828 crore, reflecting an increase of around 6 percent YoY in its bottom-line losses over the same period.
Mahanagar Telephone Nigam Limited, a public sector enterprise, is engaged in providing telecom services in the geographical areas of Mumbai and Delhi. It was set up in April 1986 by the Government of India to upgrade the quality of telecom services, expand the telecom network, introduce new services and raise revenue for telecom development needs of Delhi and Mumbai.
Written by Shivani Singh
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