Advertisment

Mahajan’s exit drives MTNL shares up

author-image
CIOL Bureau
New Update

NEW DELHI: High-flying Pramod Mahajan's exit was one of several ministerial changes the BJP-led coalition announced, and this could affect other key economic portfolios.

Advertisment

IT and communications minister Mahajan's departure drove up shares of state-run MTNL as much as 15 percent amid hopes it would make the telecom giant easier to privatize.



Mahajan, expected to take up a key organizing role in the BJP, was one of the main advocates of MTNL's merger with another state-run company, unlisted BSNL.



"The market hopes the merger proposal will be pushed to the backburner, and this has fuelled the rally," said Edelweiss Capital telecoms analyst Srinivas Rao Ravuri.



Analysts say it would be tougher to sell a merged company.

A BJP source said privatization minister Arun Shourie, who has pushed hard for sell-offs in the face of stiff resistance, would keep his post, dismissing reports he would be shifted.





"Serving the party as the need arises is a challenge," Mahajan told Star News television. "I don't take it to be a demotion... I think the next 12 months are very important for the BJP."



Shares of state-run National Aluminium Co rose as much as 5.4 percent on reports Coal and Mines Minister Uma Bharti would also leave to work for the party. Media reports said she had objected to the firm's privatization.

© Reuters

tech-news