Shares of Reliance Communications fell sharply on Monday and ended nearly 35 per cent lower after the company decided to opt for insolvency proceedings following its failure to sell assets for paying back its lenders.
RCom shares plummeted 34.91 per cent to close at Rs 7.55 on BSE. Intra-day, it nose dived 48.27 per cent to Rs 6 — its record low. At NSE, shares tumbled 34.91 per cent to close at Rs 7.55.
The company’s market valuation plunged Rs 1,120.02 crore to Rs 2,087.98 crore on BSE. On the traded volume front, 425.09 lakh shares changed hands at BSE and over 37 crore shares on NSE.
Heavy selling was also seen in other group shares, with Reliance Power tumbling 35.10 per cent, Reliance Capital 19.80 per cent, Reliance Infrastructure 14.87 per cent and Reliance Naval and Engineering 14.72 per cent on BSE.
The combined market valuation of five of these group firms tumbled Rs 5,830.72 crore on the BSE.
“RCom board of directors decides upon implementation of debt resolution plans through NCLT framework,” the company said in a statement on Friday.
It is estimated that RCom has been reeling under debt of over Rs 46,000 crore. The board on Friday reviewed the progress of debt resolution plans since the invocation of strategic debt resolution on June 2, 2017.
The board noted that despite the passage of over 18 months, lenders have received zero proceeds from the proposed asset monetisation plans, and the overall debt resolution process is yet to make any headway, the statement said.
“Accordingly, the board decided that the company will seek fast-track resolution through NCLT, Mumbai. The board believes this course of action will be in the best interests of all stakeholders, ensuring comprehensive debt resolution in a final, transparent and time bound manner within the prescribed 270 days,” the statement said.
RCom on Sunday said it will propose a similar debt resolution plan to the National Company Law Tribunal that it had been pursuing outside the court.