New Delhi, June 12, 2025 – Mahanagar Telephone Nigam Limited (MTNL), a public sector telecom company, has officially disclosed a default of ₹8,509 crore in repayment of bank loans, covering both principal and interest, across seven public sector banks, as per the latest SEBI Regulation 30 filing and the SEBI circular dated 21 November 2019.

The filing, dated June 12, 2025, lists the banks, amounts, and dates of default, with the total overdue amount including ₹7,794.34 crore in principal and ₹714.64 crore in interest. MTNL also stated its total financial indebtedness now stands at ₹34,335 crore.

Breakdown of Defaulted Loans

According to the disclosure, the loans have turned non-performing assets (NPAs) on various dates between August 2024 and February 2025. The banks and the default amounts are listed as follows:

Total Outstanding Default Amount:

• Principal: ₹7,794.34 crore

• Interest: ₹714.64 crore

• Combined Total: ₹8,508.98 crore

Nature of Obligations and Debt Details

• Type of Obligation: Repayment of principal and interest

• Security: The loans are secured, being standard bank lending agreements

• Loan Tenure and Rate: Not specified in disclosure, but assumed to be medium to long-term

Overall Financial Indebtedness

In addition to the defaulted bank loans, MTNL has disclosed its total financial indebtedness as follows:

• Bank Loans: ₹8,509 crore

• Special Government Bonds (SG Bonds): ₹24,071 crore

• Loans from Department of Telecommunications (DoT) for SG Bond interest: ₹1,755 crore

Total Financial Debt: ₹34,335 crore

Regulatory and Investor Disclosures

The disclosure aligns with Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements), 2015, and follows MTNL's past updates dated 05 July 2024, 19 July 2024, and subsequent months till 14 May 2025.

The company has been regularly informing stock exchanges about its financial constraints and inability to meet debt obligations, citing ongoing liquidity challenges.

Background and Implications

MTNL, once a key telecom operator in Delhi and Mumbai, has been facing continued financial distress for several years. The growing debt burden, compounded by operating losses and delayed government reforms, has led to increased dependence on sovereign support.

The latest default could result in:

• Credit rating downgrades

• Restrictive financing terms

• Further erosion of investor confidence

The government had previously considered various revival packages for MTNL, including mergers, asset monetisation, and VRS schemes, but structural improvements have remained limited.

Conclusion

This disclosure by MTNL of its default on a significant portion of loans is a critical development that underscores the financial fragility of the public sector telecom operator. With total indebtedness exceeding ₹34,000 crore, the company’s survival now hinges on urgent policy-level intervention, restructuring efforts, and strategic fiscal management.

Investors and stakeholders are advised to track further regulatory announcements closely, especially in relation to asset monetisation, funding support, or potential restructuring from the Government of India.

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