Loss-making state-owned telecom firm MTNL has defaulted on an interest payment of Rs 35.15 crore to Union Bank of India, which was due to be paid in July, the company said in a regulatory filing. The company is reeling under a total debt of Rs 27,330 crore.
“MTNL has defaulted in the payment of Interest to Union Bank of India,” the filing said.
The company shared a chart that shows it has defaulted Rs 35.15 crore interest payment on July 31, 2022. MTNL has a total outstanding loan of Rs 5,849.71 crore to be paid to Union Bank of India (UBI).
The loan was raised from Union Bank of India, Andhra Bank and Corporation Bank. Andhra Bank and Corporation Bank have now merged with UBI. The company owes a total of Rs 16,930 crore to other banks and financial institutions, as said in economics times.
MTNL has reported a narrowing of consolidated loss to Rs 653 crore in the June 2022 quarter. It had posted a loss of Rs 688.69 crore in the same period a year ago.
The consolidated revenue from operations of MTNL fell by about 17 per cent to Rs 250.72 crore in the first quarter of the current fiscal. In the year-ago period, the same stood at Rs 301.15 crore.
In a note, auditors of MTNL said the company’s net worth has been fully eroded. As stated in the note, the Department of Public Enterprises has declared the company to be an incipient sick Central Public Sector Enterprise, and the Department of Telecom has also confirmed this.
In July 2022, the Union Cabinet approved the raising of sovereign guarantee bonds for MTNL for an amount of Rs 17,571 crore for the next two financial years.