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Tata Communications Ltd
NSE: TATACOMM BSE: 500483 INE151A01013 Telecommunication Telecom 🔎 Screen
NIFTY 200 NIFTY 500 Midcap 100 Midcap 150
₹50,553 Cr
Market Cap
53.6
P/E
PEG
14.6%
ROCE
32.6%
ROE
3.55
D/E
19.5%
OPM
+15.9%
% from 52W High
68
α RS
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📈 Price History
Ratio Health
Excellent
Good
Average
Poor
By Category
Shareholding
About

Tata Communications was incorporated on March 19, 1986 as VSNL. In February 2002, the Government of India, as per their disinvestments plan, sold 25% of their holding in the company to the strategic partner. Consequently, the company was taken over under the administrative control of TATA. It is the leading global digital ecosystem enabler. It has a leadership position in emerging markets, and an infrastructure that spans the globe. It delivers managed solutions to multinational companies and service providers. It partners with 300 of the Fortune 500 companies with their state-of the-art solutions, including a wide range of communication, collaboration, cloud, mobility, connected solutions, network and data center services.

✓ Strengths 2
  • Company has a good return on equity (ROE) track record: 3 Years ROE 47.5%
  • Company has been maintaining a healthy dividend payout of 45.9%
! Concerns 4
  • Stock is trading at 14.7 times its book value
  • The company has delivered a poor sales growth of 7.72% over past five years.
  • Contingent liabilities of Rs.18,056 Cr.
  • Company might be capitalizing the interest cost
Key Ratios Snapshot
📊 Sector Averages
📈 Growth Pattern
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Strong quarter with forex tailwind and robust digital growth; but PAT hit by one-off taxes and EBITDA margin contracted year-on-year. quarter Investor Presentation One-Pager? Mar 2026
Revenue
₹6,554 Cr
+9.4% YoY; +3.7% YoY in constant currency
EBITDA Margin
19.6%
-86 bps YoY; -25 bps QoQ
PAT
₹263 Cr
-65% YoY; adjusted FY26 PAT +8.1% YoY
Data EBITDA Margin
18.4%
+96 bps YoY; -47 bps QoQ
What Went Right
  • Data revenue grew 11.5% YoY in Q4 (₹5,684 Cr) and 9.4% YoY for FY26.
  • Digital portfolio expanded 16.7% YoY for FY26, with next-gen connectivity up 24% YoY.
  • Free cash flow surged to ₹1,474 Cr in FY26, nearly 4x FY25, and net debt/EBITDA fell below 2x to 1.99x.
  • Order booking registered healthy double-digit YoY growth, with 70% of funnel from digital fabric.
  • Digital segment losses trended downward and digital margin improved sequentially.
What to Watch
  • Reported PAT fell 65% YoY to ₹263 Cr due to one-off tax items; adjusted FY26 PAT up only 8.1%.
  • Consolidated EBITDA margin contracted 86 bps YoY to 19.6%, driven by data revenue mix shift.
  • Underlying constant currency revenue growth was just 3.7% YoY, masking the headline 9.4% reported gain.
  • TCTS subsidiary revenue declined 33% YoY to ₹198 Cr, highlighting pressure in that segment.
  • Geopolitical uncertainty in West Asia caused event cancellations and near-term demand risks.
Investor Lens
The thesis remains intact — digital portfolio momentum, debt reduction, and free cash flow improvement are strong positives. However, the low constant-currency revenue growth (3.7% YoY) and EBITDA margin compression signal that underlying organic momentum is still modest. The new CEO Ganesh has prioritised profitable growth and digital breakeven but offered no quantified targets. PAT volatility from tax one-offs and TCTS weakness need monitoring. Next quarter should show whether digital margin improvement sustains and if forex-adjusted growth can accelerate. Watch for strategic update after 100 days in role.
From investor presentation · AI-generated analysis · Not investment advice
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📉 WEAK Revenue up 10.5% YoY but PAT plunges 31.6% to ₹130 Cr.
Revenue
Revenue grew 10.5% YoY to ₹6,583 Cr, but was nearly flat sequentially (+0.4% QoQ). Growth appears driven by core services, though momentum is subdued.
Profitability
Net profit fell sharply by 31.6% YoY to ₹130 Cr, and EPS dropped from ₹6.67 to ₹4.71. A negative other income of ₹93 Cr and higher tax rate of 41% weighed on the bottom line.
Margins
Operating profit margin held steady at 19% YoY, but slipped from 20% in the prior quarter. Absence of margin expansion despite revenue growth is a concern.
Balance Sheet
Debt-to-equity ratio stands high at 3.55x, indicating elevated leverage. ROE of 32.6% is attractive, but sustained profitability is needed to service debt.
Key Risks
Net profit decline of 31.6% YoY and 49.8% QoQ signals operational stress. High debt (D/E 3.55) amplifies financial risk. Negative other income suggests one-off or recurring losses.
Outlook
With flat sequential revenue and contracting margins, the near-term outlook remains cautious. A recovery in profitability hinges on cost control and resolution of other income drags.
Generated by AI · Jun 2026 results · Not investment advice
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Revenue by Segment

Segment Q3FY26 Q4FY26 Trend
Campaign Registry
217
EBIT 99
235
EBIT 125
Data Services
5,380
EBIT 281
5,705
EBIT 347
Real Estate
52
EBIT 28
51
EBIT 24
Transformation Services
223
EBIT 43
226
EBIT 39
Voice Solutions
373
EBIT 26
388
EBIT 18
Total 6,245 6,605

Source: NSE Integrated Filing XBRL (Reg. 33 Ind AS). Values in ₹ Crore.

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