Tata Teleservices (Maharashtra) (532371) Q4 20/21 earnings summary

Executive summary

• FY21 remained loss-making, but EBITDA improved as operating costs fell; enterprise connectivity, cloud, security and collaboration solutions were the strategic focus.

• The Consumer Mobile Business demerger to Bharti Airtel took effect July 1, 2019; the remaining business serves ~714,000 subscribers across Mumbai, Maharashtra and Goa.

Financial highlights

• Revenue from operations was ₹1,043.66 crore vs ₹1,077.74 crore; telecom service revenue was ₹1,023.98 crore vs ₹1,052.43 crore.

• EBITDA rose to ₹500.15 crore from ₹432.30 crore; EBITDA margin was 47% vs 40%, alongside operating expenses falling to ₹554.77 crore from ₹656.04 crore.

• Loss before exceptional items was ₹1,216.88 crore vs ₹1,283.83 crore; reported net loss was ₹1,996.69 crore vs ₹3,714.11 crore, including a ₹779.81 crore exceptional charge, primarily AGR-related.

• Basic and diluted loss per share narrowed to ₹10.21 from ₹19.00.

• Total borrowings, including spectrum liabilities and related items, were ₹17,638 crore vs ₹16,701 crore; net debt was ₹19,315.98 crore vs ₹16,634.26 crore.

Outlook and guidance

• Enterprise telecom markets are expected to recover after the FY20–21 COVID-related decline, with cloud, managed security, colocation and enterprise data services positioned as growth areas.

• Hybrid work is expected to support IP voice, SIP trunking, VoIP, collaboration and cloud communications; SMB spending on cloud, high-speed internet, IoT and secure VPNs is expected to increase.

• Growth may require substantial investment; management noted that sustaining growth without significant incremental investment could be challenging and that residual business lines or assets may be restructured.