Tejas Networks tanks 7% on widening web loss in Q3

Shares of Tejas Networks tanked 7 % in commerce on January 20 after the broadband, optical fibre, and wi-fi networking firm posted a consolidated web loss within the quarter ended December 31, 2023.

Tejas Networks clocked in a web lack of Rs 44.9 crore throughout the quarter, deepening from a lack of Rs 15.20 crore within the year-ago interval, impacted by increased enter prices. Nonetheless, income from operations grew 104 % on-year to Rs 560 crore for the quarter.

As of 2pm, shares of Tejas Networks have been buying and selling at Rs 815, decrease by 5.4 %, on the NSE, in comparison with the earlier session’s closing worth.

The income development was largely in-line, led by BSNL’s 4G mission execution. However margins disillusioned, as Tejas shipped primarily low-margin merchandise in Q3. That is seemingly to enhance from This fall, although.

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Home brokerage Emkay International stated that Tejas Networks advantages from the Centre’s emphasis on home manufacturing and the PLI scheme, massive spends on BSNL, BharatNet, and the Indian Railways in addition to references from TCom and TCS for fetching extra purchasers. The worldwide transfer to switch Chinese language telecom additionally acts as a tailwind.

The brokerage has lower its EBITDA margin estimates by 100-300 bps, as Tejas missed the Q3 margin estimates on combine change, although it’s anticipated to marginally reverse within the coming quarters. Whereas retaining its ‘purchase’ name, Emkay lowered its goal worth on the corporate to Rs 1,025 from Rs 1,050 earlier. The up to date goal worth implied a 19 % upside from the CMP.

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