MTNL Shares Soar 18% as ₹2,135 Crore Asset Monetization Boosts Growth
Business and Industry Overview:
MTNL is a phone and internet company owned by the Indian government. It provides services in Delhi and Mumbai. The government started MTNL in 1986 to help people talk on the phone and use the Internet. It provides landline phones, mobile networks, broadband, and fibre internet. Many people used MTNL for calling and internet before.
Later, new companies like Jio, Airtel, and Vodafone came. They gave faster Internet, better service, and lower prices. Many people left MTNL and started using these private companies. MTNL lost many customers and started losing money. The company also owes a lot of money. It spends too much on employee salaries and fixing old networks. Other companies upgraded their internet to 4G and 5G, but MTNL could not. Its Internet became slow and outdated. More people stopped using it.
The government is helping MTNL so it does not shut down. It gives money to keep it running. The government also wants to merge MTNL with another government company called BSNL. BSNL works in other parts of India except for Delhi and Mumbai. By joining both companies, the government wants to reduce money loss and improve services. This will help MTNL upgrade to faster networks like 4G and 5G.
But MTNL still has big problems. It has too much debt. It has fewer customers. Its technology is old. Many people have already left, and it is hard to bring them back. The government is trying to fix these problems. If MTNL gets better Internet, lower prices, and better service, more people may start using it again.
India has one of the largest telecom markets in the world, with 1.2 billion telephone subscribers as of May 2024. The rural telecom sector is also growing, with 59.59% of rural areas now having phone connections. Mobile data usage has increased by more than 10 times in recent years. In FY18, total wireless data usage was 4,206 petabytes, which increased to 47,629 petabytes in Q2 FY24. India is also one of the biggest consumers of data in the world. As per TRAI, the average data usage per user was only 61 MB per month in 2014, but in December 2023, it reached 19.47 GB per month.
There are many opportunities in the telecom sector. By 2026, India will have 350 million 5G users, which will be 27% of all mobile users. The country is also increasing its mobile phone exports. In FY24, exports of mobile phones grew by 42%, reaching $15.6 billion. The demand for skilled workers is also increasing. By 2025, India will need around 22 million workers in fields like 5G technology, artificial intelligence (AI), the Internet of Things (IoT), robotics, and cloud computing. India is also leading in internet usage worldwide. The country ranks 2nd in international mobile broadband internet traffic and international internet bandwidth.
Broadband is supporting the telecom industry with huge investments and policies. The Production-Linked Incentive (PLI) scheme for telecom and networking products has a budget of ₹12,195 crore ($1.65 billion). Under this scheme, 42 companies have already committed investments worth ₹4,115 crore ($502.95 million). The government is also focusing on 6G technology and has set up a special 6G Innovation Group to develop new telecom solutions.
Investments in the telecom sector are also rising. In the Union Budget 2024-25, the Department of Telecommunications and IT received ₹116,342 crore ($13.98 billion). Foreign investors are also interested in India’s telecom sector. Since April 2000, the total FDI in telecom has reached $39.32 billion. The PLI scheme for large-scale electronics manufacturing has received an investment of ₹4,700 crore ($569.49 million) as of September 2022.
India’s telecom market is growing in every area. The wireless subscriber base reached 1.168 billion in May 2024. The top telecom companies are Reliance Jio (474.61 million users), Bharti Airtel (387.76 million users), Vodafone Idea (218.15 million users), and BSNL (86.32 million users). Wired broadband is also expanding, with 41.31 million subscriptions as of May 2024. Total wireless data consumption is rising fast. In December 2023, total data usage was 50,00,047 GB, and 5G data usage alone was 6,239 PB from April to December 2023. The total revenue of the telecom sector in FY24 was ₹2.4 lakh crore ($29 billion).
India’s telecom sector will continue to grow. Cheaper data and more mobile phones will add 500 million new Internet users in the next five years. The government is working on projects like BharatNet to provide better internet in rural areas. The country is also preparing for 6G and investing in new telecom technologies. With more users, faster internet, and new policies, India’s telecom sector will become even stronger.
Reliance Jio and Airtel are the biggest telecom companies in India. Jio has the most users because it gives cheap data and fast 5G. Airtel is known for good network quality and premium services. Vodafone Idea (Vi) is facing problems because it has fewer customers and less money to improve services. BSNL is a government company that mainly works in villages but has old technology. Jio is growing fast with new services like JioFiber and JioCinema. Airtel is also strong in business services. Vi is losing customers, and BSNL is slow in upgrading. Now, Jio and Airtel are leading the market.
Latest Stock News:
MTNL’s share price increased by 13.72% on March 13, 2025, reaching ₹49.29 per share. The rise happened after the government shared data about MTNL and BSNL earning ₹12,984.86 crore by selling extra land, buildings, towers, and fiber since 2019. This was revealed in Parliament on March 12, 2025. Minister of State for Communications Pemmasani Chandra Sekhar said that MTNL and BSNL are selling only those assets that are not needed for their operations in the future. They also have the right to transfer ownership of these assets.
MTNL earned ₹2,134.61 crore by selling land and buildings. BSNL earned ₹2,387.82 crore from the same. MTNL also earned ₹258.25 crore by selling towers and fiber. BSNL earned ₹8,204.18 crore from selling towers and fiber until January 2025. The total revenue from asset sales by both companies reached ₹12,984.86 crore.
After this news, MTNL’s share price surged further in early trade on March 13, 2025. The stock jumped by 18.4% and touched ₹51.30 per share on the BSE. Investors reacted positively to the revenue details, leading to strong buying in MTNL shares.
MTNL took a loan by selling bonds and promised to pay interest every six months. The next interest payment is due on March 24, 2025, and MTNL was supposed to put the money in a special account 10 days before the due date. But MTNL does not have enough money right now, so they did not put the money in the account. However, the Government of India has promised to pay if MTNL cannot, so if MTNL does not pay, the people in charge will ask the government to step in and pay. This update is to inform everyone that MTNL is having money problems, but bondholders will still get paid because of the government’s guarantee.
Potentials:
MTNL wants to grow and become better. It has signed a 10-year deal with BSNL to improve its services. The company will sell its shares in two other companies and close one of its smaller businesses. This will help MTNL focus on its main work. The government has made a plan to help MTNL and BSNL. They will start 4G services, spend less money, and sell land and buildings they do not need. MTNL and BSNL will also merge into one big company. The government wants to get ₹16,000 crore by selling some of MTNL and BSNL’s things. Important government offices have already said yes to this plan. They are now waiting for the final approval. When everything is done, MTNL will have less debt and more money to give better telecom services to people.
Analyst Insights:
- Market capitalisation:₹ 3,079 Cr.
- Current Price:₹ 48.9
- 52-Week High/Low: ₹ 102 / 31.2
- Dividend Yield: 0.00 %
- Return on Capital Employed (ROCE): -8.18 %
MTNL is a company that provides phone and internet services, but it has been losing money for a long time. In the last three months, it lost ₹836 crore, and its earnings have fallen a lot over the past 10 years. The company has a huge debt of ₹31,203 crore and is struggling to even pay the interest on its loans. It has a negative value, meaning if you add up all its assets and debts, it owes more than it owns. Even though its stock price went up 47% this year, this is not because the company is doing well but because some investors are just buying it for short-term gains. The company is also far behind strong competitors like Jio and Airtel, and it only survives because the government helps it. Since it keeps losing money, has no real growth, and is in deep debt, it is too risky to invest in. It is better to sell the stock now instead of hoping for a recovery.