BENGALURU (Reuters) - Indian shares reversed early gains to end lower on Friday, dragged down by banks exposed to telecom operators who were told by the country’s top court to clear their dues to the government by March 17.
The broader NSE Nifty 50 index closed down 0.5% at 12,113.45 and the benchmark S&P BSE Sensex ended 0.49% lower at 41,257.74.
India’s supreme court ordered the telecom companies to clear nearly $13 billion in dues, which would add pressure on banks that are already exposed to nearly $140 billion of bad loans.
Vodafone Idea Ltd will have to shell out nearly $4 billion in dues to the government. The company’s shares closed 24.4% lower.
However, rival Bharti Airtel’s shares rose to a record high as investors felt it will be able to pay off its dues, leaving the company and billionaire Mukesh Ambani’s Reliance Jio with an opportunity to enjoy an effective duopoly in the sector.
The Nifty banking index fell 1.27%, with the state-owned banking index declining 2% and the private-sector lenders index losing 1.24%.
For the week, the Nifty and the Sensex gained 0.12% and 0.28%, respectively.
($1 = 71.3948 Indian rupees)
Reporting by Derek Francis in Bengaluru; Editing by Maju Samuel