Stock market today: Shares of telecom public sector undertaking (PSU), Mahanagar Telephone Nigam Limited (MTNL), zoomed nearly 10% in trade on Monday, February 10 following reports that the Union Cabinet, at its meeting last week, has approved funding of nearly ₹6,000 crore for BSNL for 4G expansion.
According to a report by The Economic Times (ET), this funding will be utilised to fund capex by BSNL and MTNL, thus sparking a rally in the shares of the latter. Meanwhile, a report by CNBC Awaaz stated that under the plan, around one lakh 4G sites will be set up to improve connectivity and ensure better network services for consumers.
The ET report mentioned that the proposal was approved during the Union Cabinet meeting on February 7.
It further stated that the government has already invested ₹3.22 lakh crore in BSNL and MTNL through three revival packages since 2019, which include funding for the rollout of 4G services. According to the government, as a result of these packages, BSNL and MTNL began earning operating profits starting from the fiscal year 2020-21.
Share Price Trend
Following these reports, shares of MTNL jumped 9.7% to the day’s high of ₹57.50 on the NSE. MTNL share price opened at ₹56.50, higher than the previous close of ₹52.40 apiece.
The stock thereon extended gains to hit the day’s high of ₹57.50. Meanwhile, it touched a low of 54.25 in intra-day deals.
Last week, shares of MTNL surged 14%, recording an 18% rally on February 5 amid news that the government was finalising an asset monetisation plan, intending to monetise MTNL’s non-core properties worth ₹16,000 crore.
Meanwhile, MTNL share price has gained in the last four of the five trading sessions, including today’s.
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