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Shares of Reliance Communications (RCom) tumbled 20.5 per cent a day after NCLT admitted an insolvency petition filed by Ericsson against the company and two of its subsidiaries.
After making a weak opening, the stock further tanked 20 per cent to Rs 9.95 on the BSE. On the NSE, the company shares nosedived 20.56 per cent to Rs 9.85.
Weakness was also seen in other group stocks, with Reliance Naval and Engineering trading lower by 6.23 per cent, Reliance Nippon Life Asset Management 2.70 per cent, Reliance Power 1.19 per cent and Reliance Capital 1 per cent during the afternoon trade on the BSE.
The National Company Law Tribunal (NCLT) had yesterday admitted an insolvency petition filed by Swedish communications equipment major Ericsson against Anil Ambani-run RCom and two of its subsidiaries seeking to recover Rs 1,150 crore.
Ericsson had signed a seven-year deal in 2014 to operate and manage RCom’s nationwide telecom network but has not been paid the bill. The Tribunal had admitted the petition yesterday which could potentially result in delaying RCom’s plans to sell assets to lighten its debt load.
In a statement, the company said: “RCom and two of its subsidiaries - Reliance Telecom and Reliance Infratel - await detailed order from NCLT, allowing the Ericsson application for admitting the companies to debt resolution under the IBC.”
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