Reliance Communications (RCom) Limited's share price surged as much as 45.97 percent from the previous close to Rs 15.40 at 1:36 pm after various news report suggested that the company was in settlement talks with Ericsson.
It has not seen this kind of rise in over 12 years. In fact, the value has fallen by over 60% this year.
Earlier this week, NCLT (National Company Law Tribunal) had admitted three insolvency petitions by Ericsson seeking recovery of Rs 1,154 crore from Anil Ambani's RCom and its two subsidiaries (Reliance Telecom Ltd and Reliance Infratel Ltd).
Owing to huge debts, the telecom company was looking to sell its assets to Reliance Jio after it announced a debt resolution plan last year. After a decade of success, the company lost its market share in 2016 by huge margins, dragged down by aggressive competition.
Various media reports now suggest that the two are likely to appeal to NCLAT (National Company Law Appellate Tribunal) against the said order after Ericsson's plea. This could reduce RCom's debt by $7 billion.
Investors' positive expectations saw the shares trading in huge volumes, pushing the stock price upward.