MTNL shares surge 5 pc; hit upper circuit on revival plan announcement

Shares of MTNL gained 5 percent to its highest trading permissible limit for the day after the announcement of a Rs 69,000-crore revival package for the company and BSNL, which includes merging the two loss-making firms. MTNL's scrip jumped 4.92 percent to Rs 6.19 -- its upper circuit limit on the BSE.

On the NSE, it rose 4.27 percent to its highest trading permissible limit for the day at Rs 6.10. The government on Wednesday approved a Rs 69,000-crore revival package for BSNL and MTNL that includes merging the two loss-making firms, monetizing their assets and giving voluntary retirement scheme (VRS) to employees so that the combined entity turns profitable in two years.

The cabinet approved a plan to combine Mahanagar Telephone Nigam Ltd - which provides services in Mumbai and New Delhi - with Bharat Sanchar Nigam Ltd that services the rest of the nation, Telecom Minister Ravi Shankar Prasad said. MTNL has reported losses in nine of the past 10 years and BSNL too has been ringing in loss since 2010.