Shares of Reliance Communications were trading flat ahead of the Chairman Anil Ambani's address to media later in the day as the company deals with plunging profits, heavy debt, meltdown in stock and sell-off in bonds.
At 12:30 pm, the stock was trading at Rs 20, down 0.2% on the BSE.
The stock has fallen 20% by Thursday's closing since the company reported loss of Rs 948 crore for the fourth quarter, hurt by intense price war unleashed by newcomer Reliance Jio. It had registered net profit of Rs 79 crore in the corresponding quarter of the previous fiscal year.
Concerns about RCom's debt have grown this week after the company said it was in talks with banks to defer loan repayments due over the next four months.
Moody's cut its rating on Tuesday on RCom debt to "Caa1 from B2," implying that its obligations are speculative and subject to very high credit risk.
Reliance Communications Ltd.’s short-term and long-term debt was downgraded to a lower status by Fitch Ratings, implying that "default is a real possibility”. Fitch, CARE Ratings and ICRA have also downgraded the company.
RCom has long relied on short-term debt and covenant waivers from its bankers, but if these waivers are not granted, it could impact RCom's bondholders "significantly," Moody's warned. It added that it sees no scope for RCom to deleverage amid intense competition in the telecom sector.
(With inputs from Reuters)