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Shares of India's state-owned loss-making telecom firm Mahanagar Telephone Nigam Ltd (MTNL) soared as much as 15% on Thursday, after a media report said the government has a revival plan in place.

However, the shares declined from the highs and is currently trading 5.83% higher at 19.05 on NSE. In the year-to-date (YTD) period or since the start of 2021, the stock has risen by a decent 38.91%.

India has drawn up a package worth nearly 1.3 trillion ($17.54 billion) to revive state-run telecom companies MTNL and BSNL, according to news agency NewsRise.

The proposed details are expected to be floated in the cabinet next month, the agency reported, citing a senior government official aware of the development.

"The cash component in package would be 250 billion rupees-to-300 billion rupees", the news agency reported citing the official, adding that there would also be issuance of preferential shares to the government.

The development comes after the government deferred, earlier this year, the merger of the two state-owned companies due to financial reasons, according to local media reports.

The remainder of the package would be split into about 50,000 crore of spectrum payment dues and 360 billion rupees of pending adjusted gross revenue payments, according to the NewsRise report.

The company, set up in 1986 by the Indian government, posted a loss of 6,53 billion rupees for the quarter ended Sept. 30, up from 5.83 billion rupees a year ago.

MTNL's shares rose 15% to 20.70 rupees in their biggest intraday rise since March 10 and have so far gained 30.4% this year.

The company's total debt stood at 256.15 billion rupees ($3.46 billion), at the end of financial year March 31, 2021.

MTNL has reported a widening of consolidated loss to 654.56 crore in the September quarter, mainly due to decline in revenue from operations and increase in finance cost.

The company had posted a loss of 582.25 crore in the year-ago period.

The revenue from operations fell about 7% to 425.04 crore in the second quarter of the current fiscal from 458.28 crore in the same period a year ago.

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