Tejas Networks (TEJASNET) Q1 24/25 earnings summary

Executive summary

• Achieved record Q1 FY25 net revenue of INR 1,563 crores, an 8.3x year-over-year increase and 28% sequential growth, with profit after tax at INR 77 crores and an order book of INR 7,091 crores at quarter-end.

• Major growth driven by wireless segment, particularly BSNL 4G/5G RAN installations, and significant scale-up in manufacturing capacity.

• Secured strategic international deals, including a Tier 2 US operator and a Southeast Asian broadband rollout, with ongoing major deployments in India.

• Merger of Saankhya Labs is in advanced stages, with regulatory resolution achieved and NCLT reserving the matter for orders.

• The Board approved the financial results on July 19, 2024.

Financial highlights

• Revenue from operations reached INR 1,563 crores, with sales and service at INR 1,496 crores, marking 8x YoY and 28% sequential growth.

• EBITDA for Q1 FY25 was INR 167 crores, compared to negative INR 80 crores YoY and INR 258 crores in the previous quarter; adjusted for operating income, EBITDA was INR 100 crores, nearly flat sequentially.

• Profit after tax was INR 77 crores, up from INR 26 crores YoY and INR 147 crores in Q4 FY24.

• Recognized PLI incentive of INR 66.7 crores for the quarter under other operating revenue.

• Inventory increased to INR 3,853 crores due to wireless shipment ramp-up; trade receivables rose to INR 2,052 crores; payables decreased to INR 1,376 crores; borrowings increased to INR 2,844 crores, resulting in net debt of INR 2,200 crores; cash position at INR 612 crores.

Outlook and guidance

• Strong business outlook driven by global network traffic growth, AI data centers, and broadband investments.

• Targeting large opportunities in BSNL 4G expansion, BharatNet phase III, Indian Railways' Kavach project, and international Tier 1 operator deals in the Middle East and South Asia.

• Expecting continued growth in both wireless and wireline segments, with international business anticipated to scale over time.

• PLI incentives are expected to continue, with reasonable assurance of compliance and grant receipt.