Tata Communications stock gains on Q4 earnings, rises 56% in one year

Tata Communications Ltd on April 17 reported a 1.5 percent fall in consolidated net profit at Rs 321.2 crore for the quarter ended 31 March, 2024. The company had reported a net profit at Rs 326 crore in the year-ago period.

Shares of Tata Communications edged higher on April 18, a day after the company reported a consolidated net profit of Rs 321.20 crore for the quarter ended March 31, 2024, up 7.2 times sequentially and almost in line with Street estimates. The company's total income grew 1.8 percent on-quarter to Rs 5,748.7 crore.

The EBITDA margin, a key measure of profitability, stood at 18.6 percent for the March quarter. As per the regulatory filing, the revenue from Tata Communications' core business segment of data services increased 0.9 percent sequentially to Rs 4,670.9 crore.

Revenue from voice solutions, campaign registry, real estate and payment solutions also saw an increase, while transformational services revenue declined.

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The telecom company's board also recommended a dividend of Rs 16.7 per share. This dividend, upon approval by shareholders at the ensuing Annual General Meeting (AGM), shall be paid to eligible shareholders after its conclusion, the company informed.

Tata Communications also re-appointed AS Lakshminarayanan as the managing director and CEO of the company for the second term commencing on November 26, 2024, till April 13, 2026, subject to approval of the shareholders.

"As we enter the next fiscal, our firm focus will remain on integrating our acquisitions, executing our strategies, and driving sustainable and profitable revenue growth,” said Lakshminarayanan.

At 10:36am, the Tata Communications stock was trading half a percent higher at Rs 1,894.20 on the National Stock Exchange (NSE). So far this year, the stock has risen over 7 percent. In comparison, the benchmark Nifty has gained around 2 percent. In the last one year, the counter has logged gains of 56 percent, outperforming the benchmark by 30 percent.

Also read | Tata Communications Q4 results: Net profit falls 1.5% to Rs 321 crore, revenue up 25%

In an interview with CNBC-TV18, Shilpa Rout of Prabhudas Lilladher recommended a cautious approach to the Tata Communications stock. "Since it is trading below Rs 1,900, I believe there can be some more choppiness," she said, advising investors to sell Tata Communications with a stop loss of Rs 1,920, targeting Rs 1,880 to Rs 1,850.

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