MTNL stock surrenders early gains, down over 4%

Surrendering early gains, shares of MTNL today closed over 4 per cent lower in bourses as investors booked profits amidst volatility in markets.
After rising 5.52 per cent to Rs 18.33 in intra-day, MTNL's scrip finally ended at Rs 16.74, down 3.63 per cent, on BSE.
On NSE, the stock closed 4.31 per cent lower at Rs 16.65.
The Cabinet had yesterday approved refund of about Rs 4,533.97 crore for broadband wireless access (BWA) spectrum surrendered by the state-run telco.
BSNL and MTNL did not take part in the 2010 spectrum auction and had been asked to match the price paid by the successful bidder for the airwaves. Both companies offered to surrender their spectrum and sought refunds of payments made.

BSNL had paid Rs 8,313.8 crore, while MTNL paid Rs 4,534 crore, putting a heavy burden on their books.

BSNL is returning part of the spectrum and will get Rs 6,724.51 crore as refund; while MTNL, which operates services in Mumbai and Delhi, will receive Rs 4,533.97 crore.
The GoM had also decided that the government would bear the pension burden for about 43,000 MTNL employees absorbed from the Department of Telecom.
After losses widened for nine quarters in a row, MTNL's standalone net loss narrowed to Rs 947 crore in the July-September period, mainly after lowering provisions for retirement benefits.

Meanwhile, after vaulting over 250 points, the Sensex erased most gains to end with a 45-point rise at 20,758.49.