The ITI Ltd stock gained in trade today after the government cleared continuation of quota for the state-owned firm in procurement made by three telecom firms-BSNL, MTNL and BBNL. The mid cap stock rose up to 9.80% or 9.2 points to 103 level on the BSE.
The stock opened with a gain of 9.80% at 103 against its previous close of 93.80 on the BSE.
It has lost 31.94% during the last one year and fallen 27.97% since the beginning of this year.
The Cabinet Committee on Economic Affairs (CCEA) cleared the telecom department's proposal to continue the reservation quota policy for ITI by reserving 30 per cent of the procurement orders placed by BSNL (Bharat Sanchar Nigam Ltd), MTNL (Mahanagar Telephone Nigam Ltd) and BBNL (Bharat Broadband Network Ltd) for the products manufactured by the state-owned telecom equipment maker.
The procurement quota will also include 20 per cent of the orders for the turnkey projects (like GSM network roll-out, Wi-Fi of BSNL and MTNL and BharatNet project network roll-out of BBNL), the statement said.
"Provision of procurement quota from BSNL, MTNL and BBNL will provide further boost to the order book of ITI and help in improving its financial health," an official statement said.
"The aforesaid policy measures shall remain in force for a period of three years with effect from the date of approval of CCEA. The policy shall again be reviewed considering the financial health of ITI after the expiry of this period," the statement added.
The move may also help in generating more job opportunities in the company particularly in the field of new telecom technologies, it added.
In order to enable ITI to survive in the competitive environment of telecom manufacturing, BSNL and MTNL have been extending reservation quota of 30 per cent to ITI Ltd.
The validity of reservation benefit extended to ITI had expired on May 31, 2018.