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Informist, Monday, Oct. 13, 2025

By Arya S. Biju

MUMBAI – Tata Communications Ltd. is expected to report a double-digit sequential rise in its bottom line for the September quarter on the back of a low base in the previous quarter. During the June quarter, the company's bottom line was impacted by an exceptional loss and a high base of the March quarter. The company's revenue is also expected to recover slightly after seeing a small blip in the June quarter, led by continued traction in its data services segment.

The telecommunications company's consolidated net profit for the September quarter is expected to jump over 33% on quarter and nearly 49% on year to INR 3.09 billion, according to an average of estimates from five brokerages. Nuvama Wealth Management Ltd. has the highest estimate of INR 3.93 billion for the company's net profit and JM Financial Institutional Securities Pvt. Ltd. has the lowest estimate of INR 2.62 billion. 

The company's consolidated net sales for the latest quarter is expected to rise a little over 2% on quarter and over 6% on year to INR 60.98 billion, an average of estimates from five brokerages showed. Kotak Institutional Equities has the highest estimate of INR 61.58 billion for the company's top line and JM Financial has the lowest estimate of INR 60.34 billion. 

During the June quarter, the company's bottom line had plunged 82% on a sequential basis to INR 1.90 billion, recording the steepest fall in at least 19 quarters impacted by a one-time loss of INR 626.30 million. This one-time loss in the June quarter included the impact of the dilution of its stake in a wholly owned subsidiary, which resulted in a loss of INR 421.90 million on account of foreign exchange losses. The company's bottom line for the June quarter was also impacted by a high base of the March quarter, when its net profit had quadrupled on quarter to INR 10.40 billion on the back of a one-time gain of INR 5.78 billion from the sale of its properties. Tata Communications' consolidated revenue had fallen 0.5% on a sequential basis but rose nearly 7% on year to INR 59.60 billion during the previous quarter. 

The company's largest segment, data services, is expected to report a 1.4-3.4% sequential rise in sales, estimates from three brokerages showed. This is expected to be driven primarily by growth in the company's digital platforms and services segment, though partially offset by weakness in the core connectivity services segment. JM Financial expects revenue from the company's digital platforms and services portfolio to grow 3.4% sequentially. The company's core connectivity services, on the other hand, is expected to remain weak on account of difficulty in recovering dues from a few clients in the South Asian Association for Regional Cooperation region, the brokerage said. 

The Tata Group company's earnings before interest, taxes, depreciation, and amortisation for the September quarter is expected to rise over 7% on quarter and 9% on year to INR 12.18 billion, according to an average of estimates from five brokerages. ICICI Securities expects the EBITDA margin of the company's data business to improve 11 basis points on quarter to 17.3%.

Of the seven research reports on the company available with Informist, five have a 'buy' or equivalent rating on the stock with an average target price of INR 2,014. Of the remaining two, one has a 'neutral' rating on the stock with a target price of INR 1,675 and one has a 'sell' rating with target price of INR 1,713.

Monday, shares of the company closed nearly 4% lower at INR 1,798.20 on the National Stock Exchange. The stock has risen nearly 4% since the announcement of the June quarter earnings on Jul. 17.

The following are the Jul-Sept earnings estimates for Tata Communications from five brokerages in descending order of the estimate of net profit in INR million:
 

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Deepshikha Bhardwaj

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