Mahanagar Telephone Nigam Limited (MTNL) shares on Thursday surged on the Cabinet extending financial support to the state-owned telecommunications service provider.
In intra-day trade its shares surged over 6 per cent to Rs 22.30, up from Rs 21 at previous close.
The Cabinet on Wednesday approved compensating MTNL and BSNL Rs 627.20 crore for 800 MHz CDMA spectrum that they surrendered. It approved to extend financial support of Rs 458.04 crore to MTNL for its surrendered spectrum (two carriers of 1.25 MHz each) in Delhi and Mumbai.
The surrender of spectrum by MTNL enhanced contiguity of spectrum in some licensed service areas thereby enabling higher prices obtained in auction, a source said.
In overall trade, MTNL shares remained constant to close at Rs 21 with no change from Wednesday's close.