Tata Communications Q3 Results: Cons PAT Jumps 55% YoY to Rs 365 Crore, Revenue Up 7%
Tata Communications showcased a robust quarterly performance, achieving substantial profits and steady revenue growth, despite a decline in share prices amid a broader market downturn. Here are the key highlights from their Q3 results:
Financial Highlights
– Net Profit: The company reported a 55% year-on-year increase in consolidated net profit, reaching Rs 365 crore, up from Rs 236 crore in the same quarter last year.
– Revenue from Operations: Revenue surged to Rs 6,189 crore in Q3FY26, marking a 7% rise from Rs 5,798 crore in the corresponding quarter of the previous financial year.
– Data Revenue: Data revenue climbed to Rs 5,359 crore, reflecting a 9.3% increase compared to Rs 4,903 crore in Q3FY25.
– Sequential Growth: The net profit experienced a remarkable jump of 100% on a sequential basis from Rs 183 crore in Q2FY26, while revenue saw a modest 1.5% increase quarter-on-quarter from Rs 6,100 crore.
Expense Analysis
– Operating Expenses: Total expenses for the quarter were Rs 5,914 crore, an increase from Rs 5,807 crore in Q2FY26 and Rs 5,441 crore in Q3FY25. This translates to a 2% increase quarter-on-quarter and a 9% increase year-on-year.
– Expense Breakdown: Key expense components included network and transmission costs, employee benefits, and finance charges.
Margin Overview
– PAT Margin: The profit after tax margin improved to 5.9% in Q3FY26, up from 4.4% in Q3FY25, reflecting a 148 basis point increase.
– EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) for Q3FY26 was reported at Rs 1,228 crore, a 4% increase from Rs 1,181 crore in the same period last year.
– EBITDA Margin: The EBITDA margin stood at 19.8%, a decrease of 52 basis points from 20.4% year-on-year.
Management Commentary
A.S. Lakshminarayanan, MD and CEO of Tata Communications, emphasized the company’s strategic focus on data-led growth. He stated, Our Q3 performance reflects a disciplined approach with expanding margins and a robust order book. We are gaining momentum across the business, and our investments in capabilities are translating into stronger products for our customers.
Market Reaction
Despite the impressive financial results, Tata Communications shares faced pressure in the market, trading down and hitting a low of Rs 1,696 on the NSE, reflecting a 1% decline intraday.
In summary, Tata Communications demonstrated significant year-on-year growth through solid financial performance in Q3. Their strategic focus appears to be positioning the company well for future opportunities, underscoring the potential for sustainable growth in the data communications landscape.