Won't recommend buying into Reliance Communications: Sudip Bandyopadhyay

In a chat with ET Now, Sudip Bandyopadhyay, President, Destimoney Securities Pvt. Ltd., shares his views on Reliance Communications.


ET Now: Is it the case of pressure on all current existing telecos which offered 3G or it is RComm a separate case in point?

Sudip Bandyopadhyay: RComm is a separate case. The problems of RComm are little different from many other companies in this space; the basic problem of RComm is a huge debt and that is getting reflected in the quarterly numbers very very clearly.

Till the time there is a significant reduction in the debt it will be extremely difficult for the company to perform well and the market to really appreciate the company. So when at 60-level, RComm was definitely undervalued but since nothing has happened which has really given the market a comfort on the debt reduction or a significant debt reduction, at 100-110 level one has to be still cautious.

Of course, if we see a significant debt reduction by way of sale of or realisation of value out of the tower business or the flag telecom; yes we can really look back and start buying or start taking position.

But as things stand today till something concrete happens I would not recommend buying into RComm.