Ericsson is turning down extra business from BSNL that is estimated at nearly $1 billion, the second major supplier to spurn the Indian state-run firm, a Reuters report said.
The Reuters report said Ericsson's decision comes as it is trying to rebuild both margins and investor confidence.
It shocked the market with a profit warning in October, quickly followed by a downbeat presentation in November, the two events combining to nearly halve the share price, the report said.
Ericsson will still handle 60% of BSNL's order for about 23 million lines, supplying 13.12 million lines for nearly $91 per line in a deal worth $1.3 billion, the Reutersr report said.
The remaining 40% was awarded to the second-lowest bidder, Nokia Siemens Networks, but it decided against the deal, the report added.
'We were offered and we said no,' Ericsson spokeswoman Jana Mancova, quoted by the Reuters report, said.
Mancova said the company wanted to focus on ensuring high quality for its Indian customers and said the decision was not related to the terms on offer, according to the Reuters report.
Greger Johansson, analyst at Redeye, also said the terms did not look good enough for Ericsson to take it on, the report further said.