ADAG stocks take a massive knock; Reliance Communications shares plummet by 14%
Reliance Capital tanked 10.21 per cent and Reliance Infrastructure tumbled 9.16 per cent on BSE.
- Nov 16, 2017,
- Updated Nov 16, 2017 9:07 AM IST
Shares of the Anil Ambani led Reliance group of companies came under massive selling pressure on Wednesday with the stock price of loss-making Reliance Communications plummeting by as much as 12 per cent.
Reliance Capital tanked 10.21 per cent and Reliance Infrastructure tumbled 9.16 per cent on BSE. Among other Anil Dhirubhai Ambani Group (ADAG) group companies Reliance Power plunged 8.55 per cent, Reliance Naval and Engineering fell 8.18 per cent, Reliance Home Finance was down 7.09 per cent and Reliance Nippon Life Asset Management declined 6.87 per cent.
Reliance Communications posted a fourth straight quarterly loss late on Saturday and said it was unable to pay interest on some debentures following which the debt-ridden company's shares plunged 14 per cent to settle at a record low on Monday. The telco reported a quarterly loss of Rs 2,709 crore compared with a profit of Rs 62 crore a year ago. Revenue nearly halved to Rs 2,667 crore, amid the relentless price war launched by rival Reliance Jio, which is backed by Anil's elder brother Mukesh Ambani. Brokers said the scare over RCom spread to other group firms as well and triggered the dumping of stocks.
RCom also said in a securities filing over the weekend that it has missed interest payments on two outstanding domestic non-convertible debentures.
Once the second largest telecom company, RCom is now struggling under a whopping Rs 49,000 crore debt burden.
RCom, which is on the verge of shutting its voice call service, witnessed a decline in revenue from both its India and global operations. ADAG is cutting down its telecom operations as it is unable to face the cut-throat competition from Jio's free calls and dirt-cheap data tariffs.
Reliance Communications said on Wednesday that it is not making any payment to lenders or bond- holders for the time being as it is under 'standstill period' with invocation of strategic debt restructuring scheme and working on asset-monetisation. In a regulatory filing, the telecom operator said that is in standstill period till December 2018 pursuant to the SDR (Strategic Debt Restructuring) guidelines. The Company has also announced various asset sales and a comprehensive debt resolution plan, as advised per our earlier letter dated 30th October 2017.
Accordingly, for the time being, no payment of interest and/or principal is being made to any lenders and/or bondholders of RCom, the company said in a BSE filing. The filing was in response to query of the stock exchange on report around RCom defaulting on payment of a US dollar bond.
The company has been trying to sell its assets in the infrastructure sector to trim its huge debt burden and focus on the new defence manufacturing business which forms part of the Make in India campaign launched by the Modi government.
Shares of the Anil Ambani led Reliance group of companies came under massive selling pressure on Wednesday with the stock price of loss-making Reliance Communications plummeting by as much as 12 per cent.
Reliance Capital tanked 10.21 per cent and Reliance Infrastructure tumbled 9.16 per cent on BSE. Among other Anil Dhirubhai Ambani Group (ADAG) group companies Reliance Power plunged 8.55 per cent, Reliance Naval and Engineering fell 8.18 per cent, Reliance Home Finance was down 7.09 per cent and Reliance Nippon Life Asset Management declined 6.87 per cent.
Reliance Communications posted a fourth straight quarterly loss late on Saturday and said it was unable to pay interest on some debentures following which the debt-ridden company's shares plunged 14 per cent to settle at a record low on Monday. The telco reported a quarterly loss of Rs 2,709 crore compared with a profit of Rs 62 crore a year ago. Revenue nearly halved to Rs 2,667 crore, amid the relentless price war launched by rival Reliance Jio, which is backed by Anil's elder brother Mukesh Ambani. Brokers said the scare over RCom spread to other group firms as well and triggered the dumping of stocks.
RCom also said in a securities filing over the weekend that it has missed interest payments on two outstanding domestic non-convertible debentures.
Once the second largest telecom company, RCom is now struggling under a whopping Rs 49,000 crore debt burden.
RCom, which is on the verge of shutting its voice call service, witnessed a decline in revenue from both its India and global operations. ADAG is cutting down its telecom operations as it is unable to face the cut-throat competition from Jio's free calls and dirt-cheap data tariffs.
Reliance Communications said on Wednesday that it is not making any payment to lenders or bond- holders for the time being as it is under 'standstill period' with invocation of strategic debt restructuring scheme and working on asset-monetisation. In a regulatory filing, the telecom operator said that is in standstill period till December 2018 pursuant to the SDR (Strategic Debt Restructuring) guidelines. The Company has also announced various asset sales and a comprehensive debt resolution plan, as advised per our earlier letter dated 30th October 2017.
Accordingly, for the time being, no payment of interest and/or principal is being made to any lenders and/or bondholders of RCom, the company said in a BSE filing. The filing was in response to query of the stock exchange on report around RCom defaulting on payment of a US dollar bond.
The company has been trying to sell its assets in the infrastructure sector to trim its huge debt burden and focus on the new defence manufacturing business which forms part of the Make in India campaign launched by the Modi government.