Dec 27 (Reuters) - Shares of debt-laden Indian company Reliance Communications Ltd surged as much as 25 percent on Wednesday, its second straight day of sharp gains, after the wireless carrier detailed a plan to cut debt through the sale of some assets.
RCom, as the company is known, announced on Tuesday a plan to slash its debt by 390 billion rupees ($6.08 billion) underpinned by the sale of some of its spectrum, tower, fibre and real estate assets for which it has already received some non-binding offers.
The plan builds on an earlier one announced in late October. RCom said the new plan would involve no write-offs by lenders or bondholders, nor conversion of debt to equity, triggering a 32 percent rally in its shares on Tuesday.
On Wednesday, RCom’s shares jumped to their highest since May 24 in heavy trading. More than 262 million shares changed hands as of 0615 GMT, over twice the 30-day average trading volume. Shares of RCom, backed by billionaire Anil Ambani, are still down more than a fifth in 2017.
The Indian telecom sector has witnessed a rough year after the entry of start-up Jio - backed by Anil Ambani’s brother Mukesh - last year. Aggressive pricing and consolidation in the sector has trimmed margins of the companies to wafer-thin levels. ($1 = 64.1500 Indian rupees) (Reporting by Tanvi Mehta in Bengaluru; Editing by Muralikumar Anantharaman)