Mahanagar Telephone Nigam Limited (MTNL) has announced key strategic decisions following a board meeting, including the entry into a service agreement with BSNL and the closure of Millennium Telecom Limited (MTL). The company has also approved the proposed sale of shares in MTNL STPI IT Services Ltd (MSITS) and Mahanagar Telephone (Mauritius) Ltd (MTML). According to The Economic Times, all these processes will follow regulatory guidelines and applicable laws. This latest development comes as MTNL continues to navigate its transition from traditional telecom operations to new business ventures.
The government has definitively ruled out implementing any new restructuring plan for Mahanagar Telephone Nigam Ltd (MTNL), as confirmed by Communications Minister Jyotiraditya Scindia in a written reply to the Lok Sabha. According to reports from Business Standard, the minister stated that earlier financial and administrative measures have successfully helped MTNL maintain its Ebitda-positive status since FY2021, despite mounting liabilities and declining income streams. The government's position rests on the arithmetic that MTNL holds non-core assets worth approximately ₹50,000 crore against liabilities of around ₹40,000 crore, creating a surplus of roughly ₹10,000 crore. This balance sheet position suggests the company is not insolvent and does not require a fresh rescue package.
MTNL's financial challenges have intensified significantly over recent years, with total liabilities reaching approximately ₹40,000 crore by fiscal year 2025-26, compared to ₹30,960 crore in FY2022. As reported by Business Standard, the company's losses have increased substantially from ₹2,616 crore in FY2022 to ₹3,101 crore in FY2026, while total income declined from ₹1,696 crore to ₹1,469 crore during the same period. The company's debt structure as of recent reckoning shows ₹33,568 crore total debt comprising ₹8,346 crore bank loans, ₹24,071 crore sovereign guaranteed bonds, and ₹1,151 crore owed to the Department of Telecommunications for bond interest. Despite these challenges, MTNL has maintained its Ebitda-positive position since FY2020-21.
The government has implemented comprehensive financial and administrative measures to support MTNL's operations, according to the minister's statement reported by Business Standard. These include restructuring of high-cost debt through sovereign guarantee bonds worth ₹24,071 crore, funding of the voluntary retirement scheme for MTNL employees through budgetary support of ₹4,327 crore, and financial support of ₹3,657.05 crore to MTNL for servicing SGB interest payments. The transfer of MTNL's operational activities to Bharat Sanchar Nigam Ltd (BSNL) was completed in 2024.
Despite holding non-core assets worth around ₹50,000 crore, MTNL's asset monetisation efforts have been slow, with the company earning ₹2,134.61 crore from monetising land and buildings up to January 2025, alongside ₹258.25 crore from towers and fibre. As reported by Business Standard, the company's asset base has declined to ₹10,033 crore at the end of FY2026, down from ₹12,303 crore in FY2022. The assets are overwhelmingly real estate, much of it prime land and buildings in Delhi and Mumbai, with the record on converting book value into cash being slow. The government's position is that monetising surplus property rather than new capital infusion or restructuring scheme is sufficient to work down liabilities.
