Government telecom company MTNL is unable to repay the loan of Rs 8,585 crore to public sector banks! As soon as the news came out, MTNL shares crashed

Mahanagar Telephone Nigam Limited (MTNL) is India's largest telecom operator. The company said in its regulatory filing that it is currently facing a financial crisis. The company said it has defaulted on loans and interest payments to the tune of Rs 8,585 crore from seven public sector banks.
In a regulatory filing on Tuesday, MTNL said it had taken loans from some large state-owned banks. Now she has failed to repay the entire amount, including interest. The impact of this disclosure was seen on the shares of MTNL. On Tuesday, MTNL shares fell 4.80 per cent to close at Rs 49.59, down Rs 2.50 from the previous session. These banks are State Bank of India, Punjab National Bank, Bank of Baroda, Bank of India, Union Bank, IndusInd, HDFC Bank, ICICI Bank, Axis Bank and Kotak Mahindra Bank. The default occurred between August 2024 and February 2025, the company said. Of the total dues, Rs 7, 794.34 crore is principal and Rs 790.59 crore is interest.
Union Bank of India has the highest outstanding of Rs 3, 733.22 crore, followed by Indian Overseas Bank with Rs 2, 434.13 crore. MTNL is reeling under a huge debt burden. It has total debt of Rs 34,484 crore. This includes a loan of Rs 8,585 crore, a sovereign guarantee bond of Rs 24,071 crore and a loan of Rs 1,828 crore from the Department of Telecommunications for payment of interest on it. The government has given financial help to the company earlier, but the way the debt burden is increasing on the company, questions are being raised on its recovery.