1. At a Glance
Welcome to the museum of Indian telecom history —Mahanagar Telephone Nigam Ltd(MTNL). Once a Navratna PSU roaring with copper wires and government pride, now a fossilized operator surviving on life support from sovereign guarantees. The company’s latest quarterly results (Q2FY26, i.e., Sep 2025) read like a tragic comedy: sales ₹190 crore (down 29% YoY), losses ₹960 crore, and net worth fully eroded — to the tune of negative ₹28,000 crore.
At a current market cap of ₹2,456 crore and share price around ₹39, MTNL is the kind of penny stock that isn’t actually a penny stock — it’s a whole sad rupee drama. The company has ₹34,064 crore of debt and has defaulted on interest to multiple banks. It even missed semi-annual bond interest payments on Series VII-A, VII-B, and VIII-C, with regulators watching like disappointed parents.
Operating margins are an astonishing-65%, ROCE is-6.76%, and ROE doesn’t even exist anymore. Yet, somehow, the stock is still up 32% over five years — proof that in India, nostalgia is a better investment thesis than fundamentals.
2. Introduction
Once upon a time, in 1986, MTNL was born to bring telecommunication glory to the elite metros of Delhi and Mumbai. Fast-forward four decades, and while other telecoms are beaming 5G satellites and AI-driven data, MTNL is still trying to fix its copper cables.
The company’s entire coverage area remains limited to two cities —Delhi and Mumbai. Yes, that’s it. Meanwhile, Reliance Jio and Bharti Airtel have made pan-India networks feel like a JioMart delivery — instant and everywhere.
MTNL’s subscriber base has been evaporating faster than its cash flow, falling sharply over the last five years. The market share of its once-dominant landline business has slipped from55.27% in FY17 to just 38% in FY22. In the age of 5G and fibre, MTNL is still babysitting landlines — truly, a telecom relic running on government oxygen and nostalgia.
And what does ₹39 a share buy you? A company that earns ₹689 crore in annual revenue but loses ₹3,567 crore doing it. You could call it “value investing,” but it’s more like sentimental archaeology.
3. Business Model – WTF Do They Even Do?
MTNL’s “business model” is a historical artifact. The company provides telecom services — mobile, broadband, landline, enterprise solutions — but its primary revenue still comes from wireline and government contracts.
Let’s simplify: MTNL was set up to servejust two cities, Delhi and Mumbai, while BSNL handled the rest of India. This split made sense in 1986, when landlines were status symbols. In 2025, it feels like running a postal service for pigeons.
Here’s what’s left of the empire:
- Mahanagar Telephone (Mauritius) Ltd– a debt-free offshore unit handling mobile and internet services in Mauritius, mostly run by deputed officers (yes, government babus in paradise).
- Millennium Telecom Ltd– offers ICT projects, cloud services, and Wi-Fi solutions for clients like Air India, Thane Municipal Corporation, and the J&K Government.
- MTNL-STPI IT Services Ltd– a 50:50 JV with Software Technology Parks of India, supposedly for IT park development.
- United Telecom Ltd (Nepal)– the Nepal JV that’s basically insolvent and unable to pay statutory dues. MTNL has refused to put more money in.
So, what does MTNLactuallydo today? Provide poor broadband in Delhi, pay salaries on time (barely), and issue press releases about unpaid interest.
4. Financials Overview
| Metric | Latest Qtr (Sep’25) | Same Qtr LY (Sep’24) | Prev Qtr (Jun’25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | ₹190 Cr | ₹267 Cr | ₹159 Cr | -28.8% | +19.5% |
| EBITDA | ₹-108 Cr | ₹-27 Cr | ₹-92 Cr | -300% | -17% |
| PAT | ₹-960 Cr | ₹-890 Cr | ₹-943 Cr | -7.9% | -1.8% |
| EPS (₹) | -15.24 | -14.13 | -14.97 | -7.9% | -1.8% |
Commentary:MTNL’s results are like déjà vu — every quarter looks exactly the same, except the numbers get redder. Operating margins remain negative, debt keeps ballooning, and every press release reads
like an obituary.
At this point, the only “growth” visible is in debt and penalties.
5. Valuation Discussion – Fair Value Range (for Education Only)
Let’s humor the idea of valuation.
P/E Method:EPS = -₹56.6 → P/E = Not meaningful (loss-making).
EV/EBITDA Method:EV = ₹36,432 croreEBITDA (FY25) = -₹470 crore→ EV/EBITDA = -77.5× (which is like saying “please stop”).
DCF Method:If we assume cash flows are negative forever (as history suggests), the DCF yields… basically zero.
Fair Value Range (Educational Estimate):₹0 – ₹15 per share.
(Disclaimer: This fair value range is for educational purposes only and is not investment advice. Unless you are the Government of India, in which case, good luck.)
6. What’s Cooking – News, Triggers, Drama
MTNL’s announcements read like a daily soap — lots of “non-funding,” “defaults,” and “extensions.”
- Defaults Galore:The company recently defaulted on principal and interest toseven banks, with ₹8,881 crore overdue.
- Bond Interest Misses:Missed escrow funding for several bond series — VII-A, VII-B, VIII-C, etc. The government guarantee may soon be invoked.
- CMD Drama:Shri A. Robert J. Ravi, CMD of BSNL, has beenadditionallyhandling MTNL since forever — because apparently no one else wants the job.
- Auditor Adverse Report:Q2FY26 results included auditor remarks on net worth erosion and “material uncertainty about going concern.” Translation:We’re not sure if this company can survive another year.
- TRAI Fines:Got fined ₹1 lakh for quality-of-service failures. Small penalty, but symbolic of a bigger mess.
So, what’s cooking? Mostly overdue interest payments, auditor warnings, and CMD extensions. It’s less telecom, more tragicomedy.
7. Balance Sheet (as of Sep 2025)
| Metric (₹ Cr) | FY23 | FY24 | FY25 | Sep 2025 |
|---|---|---|---|---|
| Total Assets | 11,672 | 10,745 | 10,253 | 9,548 |
| Net Worth (Equity + Reserves) | -20,855 | -23,644 | -26,919 | -28,799 |
| Borrowings | 28,351 | 30,141 | 32,441 | 34,064 |
| Other Liabilities | 4,176 | 4,248 | 4,731 | 4,283 |
| Total Liabilities | 11,672 | 10,745 | 10,253 | 9,548 |
Balance Sheet Banter:
- The only thing growing here is theborrowings column.
- “Net worth” is now an underground tunnel — negative ₹28,000 crore and
