Shares of Tata Communications plunged 4% today after the firm reported earnings for the quarter ended December 2022. Tata Communications stock slipped 3.82% to Rs 1,330 against the previous close of Rs 1,382.90 on BSE. The large cap stock has gained 3.61% in one year and risen 5.14% since the beginning of this year. Total 0.15 lakh shares of the firm changed hands amounting to a turnover of Rs 1.99 crore on BSE.
Market cap of the Tata Group firm fell to Rs 38,218 crore. The stock hit a 52-week high of Rs 1429.95 on January 12, 2023 and a 52 week low of Rs 856 on February 15, 2021.
Tata Communications shares are trading higher than the 20-day, 50-day, 100-day and 200-day moving averages but lower than 5-day moving averages.
Tata Communications reported a consolidated net profit of about Rs 394 crore for the December 2022 quarter, a tad lower than the year-ago period. The Q3 FY23 net profit was 0.3 per cent lower than last year's figure of about Rs 395 crore (profit for the period attributable to equity holders of the parent).
Sales of the Tata Group firm climbed 8.21% to Rs 4528.34 crore in the December quarter against Rs 4184.89 crore in the corresponding quarter of the previous fiscal.
Operating profit excluding other income stood at Rs 1077 crore in Q3 against Rs 1082 crore in the December quarter of the previous fiscal.
On a sequential basis, net profit fell 26 per cent from Rs 532.29 crore in the September quarter. However, net sales rose 2.20% from Rs 4430.74 crore in the September quarter.
Data business revenues stood at Rs 3,593 crore in Q3, logging an increase of 11.1 per cent on-year, the company said, adding strong momentum in the digital platforms and services segment continued.
The core connectivity portfolio reported growth of over 6 per cent year-on-year in revenue, and the digital platforms and services delivered growth of over 17.2 per cent.
YES Securities said revenue of the Tata Group firm came in line with estimates. However, EBITDA margin were below estimates on higher employee cost
"The Q3 earnings were a mixed bag but revenue growth trajectory needs to pick up further. We currently have neutral rating on the stock. Trades at EV/ EBITDA of 8.9x on FY24E," the brokerage added.
Tata Communications is engaged in the business of providing international telecommunications services. The company’s segments include Voice Solutions (VS), Data and Managed Services (DMS) and Real Estate (RE). The VS segment includes international and national long distance voice services. The DMS segment includes corporate data transmission services, virtual private network signaling and roaming services, television, and other network and managed services. The RE segment includes lease rentals for premises given on lease and does not include premises held for capital appreciation.
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