Reliance Communications shares jumped over 7 per cent on Wednesday, recovering from near 52-week lows hit in the previous session. On Tuesday, Reliance Communications shares hit an intraday low of 46.35, coming close to their 52-week low of Rs 45.65 hit in August, 2015.
Traders said buying by foreign fund has lifted the sentiments in RCom shares. According to bulk deal data on National Stock Exchange, Singapore-based Integrated Core Strategies (Asia) Pte bought 1.85 crore shares of RCom yesterday. The shares, representing nearly 1 per cent stake in RCom, were bought at an average price of Rs 46.96.
Reliance Communications has underperformed its bigger peers in last three months. Its shares have fallen nearly 10 per cent in last three months as compared to 10 per cent gain in Bharti Airtel shares and 9.5 per cent rise in Idea Cellular shares.
Additionally, RCom's management said that India's fourth biggest telecom operator will cut down its over Rs 40,000 crore debt by 75 per cent.
High debt has been a big overhang on RCom shares. On Monday, Reliance Communications had reported 22 per cent decline in its profit for the fourth quarter at Rs 177 crore on account of lower revenue from voice and data services.
Global brokerage CLSA downgraded Reliance Communications shares to "sell" from "outperform", citing its high debt and fall in Q4 profit margin. CLSA has a target price of Rs 43 on the stock.
Reliance Communications shares ended 4.89 per cent higher at Rs 49.25 apiece compared to 0.17 per cent gain in the broader Sensex.