During Friday’s trading session, the shares of a company engaged in designing and manufacturing high-performance telecom and networking products surged nearly 3 percent to hit an intraday high at Rs. 1,304.95 on BSE.
Stock Performance
With a market cap of Rs. 21,958.2 crores, at 02:05 p.m., the shares of Tejas Networks Limited were trading in the green at Rs. 1,282.45, up by 1.12 percent, as against its previous closing price of Rs. 1,268.3. The stock has delivered positive returns of nearly 57.5 percent in one year, as well as around 10.6 percent returns in the last six months. So far in 2024, the shares of Tejas Networks have given positive returns of about 47 percent.
Product Portfolio
Tejas Networks offers a diverse range of products across wireless, wireline, and satellite communication technologies. Its portfolio includes advanced wireless solutions such as 4G/5G systems based on 3GPP and O-RAN standards, along with fibre broadband technologies like GPON and XGS-PON.
The company also provides carrier-grade optical transmission products (DWDM/OTN), packet switching and routing solutions (Ethernet, PTN, IP/MPLS), and satellite communication products.
Key Updates and Order Book for Q2 FY25
In the Wireless Business, the company ramped up 4G/5G RAN shipments for BSNL’s pan-India network, surpassing 58,000 site installations. Tejas Networks has also secured additional orders for the densification of installed 4G sites in a few circles.
In the Wireline Business, the company got selected for PTN and DWDM equipment capacity expansion by a Tier-1 telecom operator in India. It was also selected by a leading state power utility and in smart city projects.
Additionally, Tejas Networks saw strong demand for its GPON and DWDM products in international markets, securing new customers in the Americas and Africa, as well as an initial order for a network modernization project in the United States.
As of Q2 FY25, the company’s order book stood at Rs. 4,845 crores, with Rs. 4,627 crores worth of orders in India and Rs. 218 crores in international orders.
Future Outlook
In the Wireless Business, Tejas Networks is focusing on key growth opportunities, including the expansion of BSNL’s 4G network and its 5G upgrade, the Indian Railways’ Kavach (Collision Avoidance System), and Private 5G applications for large enterprises across India.
In the Wireline Business, the company is targeting opportunities such as BharatNet Phase 3, the expansion of DWDM backbone networks in the utility sector, as well as FTTH and network modernization projects with multiple operators in EMEA and the Americas.
Additionally, Tejas Networks is pursuing significant opportunities in Broadband deals with Tier 1 operators in the Middle East, along with Wireless and Metro Aggregation deals with a Tier 1 operator in South Asia.
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Recent Developments
On 16th August, Saankhya Labs Private Limited, a majority-owned & controlled subsidiary of Tejas Networks, received a provisional purchase order worth Rs. 96.42 crores from NewSpace India Limited, a Public Sector Enterprise under the Department of Space (GOI).
The order was for the supply, installation and commissioning of Two-way Mobile Satellite Service (MSS) Terminals (Xponders) for vessel communication and support systems in marine fishing vessels, aimed at monitoring, control and surveillance (MCS).
In Q2 FY25, Tejas was selected as the RAN equipment supplier for a pan-India 4G/5G network of BSNL. The initial order, worth Rs. 7,492 crores, is for the supply of 4G RAN equipment. Tejas Networks will be the sole supplier of the Baseband and Radio units, with a project implementation timeline of 12-18 months.
Shareholding Pattern
As per the September 2024 shareholding pattern, the Promoters hold a 55.42 percent stake in the company, Foreign Institutional Investors (FII) hold a 9.58 percent stake, while Retail Investors and Domestic Institutional Investors (DII) hold a 30.24 percent and 4.76 percent stake in Tejas Networks, respectively.
As per the September 2024 shareholding data available with the BSE, the ace investor Vijay Kedia via Kedia Securities Private Limited holds a 1.87 percent stake in Tejas Networks.
Financials
Tejas Networks reported impressive growth in consolidated revenue from operations, experiencing a year-on-year increase of nearly 610 percent, rising from Rs. 396 crores in Q2 FY24 to Rs. 2,811 crores in Q2 FY25. The company’s net profit increased from a loss of Rs. 13 crores to a profit of Rs. 275 crores, over the same period.
Key Financial Ratios
In terms of key financial metrics, Tejas Networks currently has a Return on Equity (RoE) of 2.06 percent and a return on capital employed (RoCE) of 3.68 percent in Q2 FY25. Additionally, the company’s debt-to-equity ratio stands at 0.78.
About the company
Founded in 2000, Tejas Networks Limited, a part of the Tata Group, is India’s leading indigenous developer and manufacturer of telecom and networking equipment, specialising in both wireless and wireline solutions.
The company designs, develops, and manufactures high-performance, future-ready products for building high-speed communication networks that carry voice, data and video traffic from fixed-line, mobile and broadband networks.
Tejas Networks serves a diverse range of customers, including telecom service providers, internet service providers, web-scale internet companies, utility companies, defence companies and government entities. The company listed its equity shares at BSE and NSE on 27th June 2017.
Subsequently, the company entered into a Share Purchase and Share Subscription Agreement with Panatone Finvest Limited, through which it raised Rs. 1,850 crores. As a result of this agreement, Panatone Finvest Limited became the promoter of the company, with Akashastha Technologies Limited and Tata Sons Private Limited joining as members of the promoter group.
Written by Shivani Singh
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