Synopsis: Reliance Communications and its subsidiary Reliance Telecom are in the spotlight as certain RTL loans have been flagged as fraudulent by the Central Bank of India while the companies undergo CIRP.
The shares of the penny stock company specializing in integrated telecom services, offering wireless/wireline, broadband, enterprise solutions (voice, data, IT), data centers and and operating one of the world’s largest optical fiber networks, are been into the spotlight upon declaring the Loan accounts of its Arm, Reliance Telecom, as Fraud.
With a market capitalization of Rs. 293.15 crores on Wednesday, the shares of Reliance Communications Limited declined upto 2.7 percent, making a low of Rs. 1.05 per share compared to its previous closing price of Rs. 1.08 per share.
What Happened
Reliance Communications Ltd. (RCom) has announced that the Central Bank of India has declared certain loan accounts of its subsidiary, Reliance Telecom Ltd. (RTL), as fraudulent. The company said it is currently seeking legal advice on the matter, according to a filing with the stock exchange.
Reliance Communications (RCom) and its subsidiary Reliance Telecom (RTL), which are part of the Anil Ambani Group, are undergoing the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC), 2016. As part of this process, the companies’ creditors have approved plans to resolve their debts, but these plans still need final approval from the National Company Law Tribunal (NCLT).
The loans flagged as fraudulent by the Central Bank of India were taken by RTL before it entered CIRP. RCom said that any issues with these loans will be handled through the resolution plan or liquidation, as per the IBC rules. The person in charge of managing RTL’s insolvency, called the Resolution Professional (RP), has reviewed the suspicious transactions and filed requests with NCLT to cancel some of them, which are now being considered.
While CIRP is ongoing, both companies are protected from lawsuits or legal actions, so the process can continue smoothly. Also, once the resolution plan is approved, the companies are protected from liabilities for offences committed before CIRP, including illegal transactions identified in audits. The IBC overrides any other laws that might conflict with these protections.
In short, even though the Central Bank flagged some RTL loans as fraudulent, they stated that these issues will be resolved through the insolvency process, and the companies are legally protected until the NCLT approves the resolution plans.
Financials & Others
The company’s revenue declined by 14.43 percent from Rs. 88 crore in September 2024 to Rs. 87 crore in September 2025. Meanwhile, the Net loss rose from Rs. 2,286 crore to Rs. 2,701 crore during the same period.
Reliance Communications Limited (RCom) was a major Indian telecom provider under the Anil Dhirubhai Ambani Group, offering mobile (wireless) and fixed-line services, data centers, and a vast global fiber network via its subsidiary Global Cloud Xchange (GCX), serving both retail and large corporate clients with enterprise solutions and connectivity.
The company offers a wide range of services, including wireless (GSM/LTE), wireline, broadband, enterprise networking, IP transit, data center services, and cloud telephony. It has also built an extensive fiber optic network in India and abroad, along with substantial tower infrastructure and a large subsea cable system (GCX).
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