Mahanagar Telephone Nigam Limited reported a standalone net loss of ₹3,101.50 crore for FY26, narrowing from ₹3,341.36 crore in FY25, as total income rose to ₹1,468.81 crore from ₹1,279.75 crore.

Financial Performance Overview

The company's standalone revenue from operations declined to ₹887.27 crore in FY26 from ₹1,060.54 crore in FY25, a decrease of ₹173.27 crore. However, other income surged to ₹581.54 crore from ₹219.21 crore, an increase of ₹362.33 crore, driven largely by a gain on sale of property, plant and equipment of ₹410.95 crore. Total expenses fell to ₹4,571.76 crore from ₹4,603.26 crore in the prior year.

The following table summarises the standalone and consolidated financial highlights for FY26:

Segment-wise Performance

MTNL operates across three segments. The table below shows segment revenue for FY26 versus FY25:

Infrastructure leasing, which includes tower rent of ₹51.75 crore and rental income of ₹455.39 crore, contributed ₹507.14 crore in FY26, up from ₹431.59 crore in FY25. Basic and other services revenue fell sharply to ₹364.37 crore from ₹616.18 crore.

BSNL Service Agreement and Revenue Sharing

MTNL and BSNL entered into a Service Agreement on November 22, 2024, under which BSNL assumed responsibility for the maintenance and operational activities of MTNL's telecom services with effect from January 1, 2025. Under this arrangement, BSNL bears capital expenditure and operating expenditure for telecom operations in Delhi and Mumbai. Certain customers were migrated to BSNL with effect from April 1, 2025, with billing and collection handled by BSNL for those customers. Revenue share against migrated customers, amounting to ₹156.51 crore (Delhi Unit ₹69.84 crore and Mumbai Unit ₹86.67 crore), was recognised by MTNL during FY26.

Asset Monetisation

During FY26, MTNL realised ₹419.15 crore through asset monetisation:

Sixteen properties have been identified for monetisation in FY27 through direct sale or transfer to government departments and open-market auction.

Debt and Credit Position

Total financial indebtedness as at March 31, 2026 stood at ₹36,314 crore, comprising bank loans of ₹9,263 crore, sovereign guarantee bonds of ₹24,071 crore, and a loan from the Department of Telecommunications for sovereign guarantee bond interest payments of ₹2,980 crore. All bank loan accounts have been classified as Non-Performing Assets by lender banks. Defaults on term loan principal repayment amounted to ₹2,145.73 crore and on interest repayment amounted to ₹501.45 crore as at March 31, 2026.

Credit ratings reaffirmed during FY26 are summarised below:

Capital Structure and Dividend

The authorised share capital as at March 31, 2026 stood at ₹10,000 crore, comprising 65 crore preference shares of ₹100 each and 350 crore equity shares of ₹10 each. Paid-up equity share capital remained at ₹630 crore, comprising 63 crore equity shares of ₹10 each. The Government of India (President of India) held 56.25% of the equity as at March 31, 2026. No dividend was declared for FY26, as the company has not reported operating profit.

Subsidiaries and Joint Ventures

Key performance highlights of subsidiaries and joint ventures for FY26:

MTL declared a final dividend of ₹0.28 crore for FY26, subject to shareholder approval. MSITSL recommended a dividend of 50% on paid-up share capital for FY26, down from 75% in the prior year.

Going Concern and Auditor's Report

The statutory auditors issued an adverse opinion on the standalone and consolidated financial statements for FY26, citing the fully eroded net worth, continuous net cash losses, current liabilities substantially exceeding current assets, and defaults on bank loan repayments aggregating ₹9,262.53 crore. The auditors also noted a material uncertainty related to going concern. The standalone net worth as at March 31, 2026 was negative at ₹(29,974.84) crore.

The Comptroller and Auditor General of India noted that spectrum usage charges demand of ₹671.56 crore raised by the Department of Telecommunications was not recognised as a liability in the financial statements, resulting in an understatement of expenses and liabilities by that amount.

40th Annual General Meeting

The 40th Annual General Meeting of MTNL is scheduled to be held on Wednesday, September 30, 2026 at 11:30 AM through Video Conferencing/Other Audio Visual Means. The record date for the AGM is September 23, 2026, and the register of members will remain closed from September 24, 2026 to September 30, 2026.

Mahanagar Telephone Nigam has been fined ₹12,66,140 by the National Stock Exchange for failing to comply with several provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The penalty, communicated via an email dated August 25, 2026, covers non-compliances identified during the quarter ended June 2026. The total fine includes a basic penalty of ₹10,73,000 and GST of ₹1,93,140.

Regulatory Violations

The exchange cited breaches across six key areas of corporate governance. The largest component of the fine stems from Regulation 17(1), concerning the composition of the Board, including the failure to appoint a woman director. This single violation attracted a basic fine of ₹4,55,000.

Other significant penalties were levied for failures in constituting statutory committees. The Audit Committee, Nomination and Remuneration Committee, Stakeholder Relationship Committee, and Risk Management Committee each incurred basic fines of ₹1,52,000 due to non-compliance with their respective regulatory requirements.

Company Response

Mahanagar Telephone Nigam disclosed the penalty in a filing dated August 26, 2026. The company stated that the fines have no material impact on its financial or operational activities.

As a Public Sector Undertaking, MTNL noted that all board appointments, including those of independent directors, are made by the Department of Telecommunications under the Ministry of Communications. The company confirmed that the matter of appointing six independent directors has been taken up with the Government of India.

What the Numbers Show

The fine structure reveals a heavy concentration on governance delays rather than operational lapses. The four committee-related violations (Regulations 18, 19, 20, and 21) collectively account for ₹6,08,000 of the basic fine, representing approximately 57% of the total penalty. This suggests systemic delays in fulfilling statutory compliance requirements linked to board appointments, which are dependent on administrative ministry approvals.

Next Steps

The exchange has directed MTNL to pay the fine within 15 days of the communication date. Failure to comply could result in the freezing of promoter shareholding. Additionally, if this constitutes the second consecutive quarter of non-compliance for specific regulations, the company faces potential transfer to the Z group and suspension of trading.

MTNL has requested a waiver of the fines, citing its status as a government enterprise where appointment powers rest with the administrative ministry.