Tata Communications Q1: Mixed Bag with Revenue Growth, Profit Decline

18 Jul 2024 , 04:01 PM

Tata Communications Limited reported a consolidated net profit of ₹333 Crore for the quarter ending June 30, 2024, marking a 12.8% decrease from ₹382 Crore in the same period last year.

Revenue Performance

Despite the decline in net profit, the company’s revenue showed a significant increase:

• Total Revenue: Increased by 18.1% year-on-year to ₹5,633 Crore.
• Data Business Revenue: Rose by 20% to ₹4,694 Crore.
• Digital Portfolio Revenue: Saw a substantial growth of 51.5% year-on-year, contributing 45.7% to the data revenue.

EBITDA and Margins

The company’s consolidated EBITDA grew by 9.8% year-on-year to ₹1,124 Crore, with margins expanding to 20%.

CEO’s Statement

AS Lakshminarayanan, MD and CEO of Tata Communications, expressed optimism about the company’s performance and future prospects:

“We are pleased to announce a strong and positive start to FY25, with our quarterly performance indicators showing promising results. We remain bullish about the market opportunities, and with our expanded product capabilities and increasing customer relevance, we are confident in our ability to achieve our medium-term growth objectives.”

Board Approvals

The board of Tata Communications has approved several strategic initiatives:

• Fundraising: The company will raise funds by issuing Non-Convertible Debentures (NCDs) on a private placement basis up to ₹2,000 Crore.
• Investment in Subsidiary: The board has approved a proposal to invest in its step-down wholly-owned subsidiary, Tata Communications (UK) Limited (TC UK). This investment aims to simplify the existing group structure by moving TC UK under direct ownership, without altering its ultimate ownership and beneficial economic interest.