Reliance Communications surges on upcoming binding agreement with Aircel

Reliance Communications (RCom) declared that RCom and Maxis Communications Berhad (MCB) and Sindya Securities and Investments (Sindya), the shareholders of Aircel, expect to sign a binding definitive documentation. The company will announce the proposed transaction for the combination of the Indian wireless business of RCom and Aircel very shortly. Meanwhile, its transaction will be subject to regulatory, shareholders’ and other third party approvals.

The rating agency ICRA on June 22, upgraded its outlook to stable from negative on the long term rating 'BBB+' of  RCom. It has also reaffirmed rating of A2+ for short-term fund based/non fund based limits and commercial papers of the company.

On financial front, RCom’s revenue has remained flat at Rs 21711 crore in FY16 as compared to previous fiscal year. The company’s EBITDA has reduced by 2.4 per cent to Rs 7017 crore in FY16 on a yearly basis. Its net profit also has reduced by 4.62 per cent to Rs 681 crore in FY16 as compared to previous financial year.

The share price of RCom has increased by 5.77 per cent on bourses in early trades; and is trading at Rs 49.8 on an intraday basis.

RCom has a customer base of over 118 million, including over 2.6 million individual overseas retail customers. The company’s corporate business includes over 39000 Indian and multinational corporations, including small and medium enterprises and over 290 global, regional and domestic carriers. It owns and operates the world's largest next generation IP enabled connectivity infrastructure, comprising over 2.8 lakh kilometres of fiber optic cable systems in India, USA, Europe, the Middle-East and the Asia-Pacific region.