This Tata Group stock has zoomed 40% in 2 days on robust Q4 results

Tejas Networks share price: Shares of Tejas Networks hit a new high of Rs 1,084.50 as they rallied nearly 20 per cent on the BSE in Tuesday's intraday trade amid heavy volumes

Shares of Tejas Networks hit a new high of Rs 1,084.50 as they rallied nearly 20 per cent on the BSE in Tuesday's intraday trade amid heavy volumes. In the past two trading days, the stock price of the Tata Group company has zoomed 40 per cent after it reported robust earnings with profit after tax of Rs 146.80 crore for the quarter ended March 2024 (Q4FY24). The company had posted a net loss of Rs 11.5 crore in the year-ago quarter.

Tejas Networks' net revenue rose over four-fold at Rs 1,326.90 crore in Q4FY24, compared to Rs 299.30 crore in Q4FY23. The company has a strong order book position of Rs 8,221 crore.

On the bourses, the stock of the telecom gear-maker surpassed its previous high of Rs 939.90 touched on October 18, 2023. Average trading volume on the counter had jumped six-fold till 09:40 AM with a combined 7.26 million equity shares having changed hands on the NSE and BSE in the first 25 minutes of trade.

Meanwhile, thus far in the month of April, the market price of Tejas Networks has appreciated by 65 per cent. 

During the financial year 2023-24, Tejas Networks made major investments to ramp up its research & development (R&D) team and operations which are essential to deliver the growth potential of the company, the management said.

The company not only ramped up BSNL's 4G/5G RAN shipment, but also completed the delivery of the large volume of IP/MPLS routers for backhaul network. During Q4FY24, the company was granted 22 patents, taking the total patent count to 335, the management added.

Tejas Networks designs and manufactures high-performance wireline and wireless networking products for telecommunications service providers, internet service providers, utilities, defence and government entities in over 75 countries. Tejas Networks is a part of the Tata Group, with Panatone Finvest Ltd. (a subsidiary of Tata Sons Pvt. Ltd.) being the majority shareholder.

The company expects India business to continue to be a large majority of its revenues over the next 2-3 years. The management sees a strong capex cycle for telecom equipment, fuelled by ongoing 5G rollouts, increase in fiber-broadband penetration and increased focus by the Government on connectivity in rural areas.

Given the strategic importance of a secure telecom infrastructure, the Government of India has a strong focus on achieving 'Atmanirbharta' (self-reliance) in telecom equipment - both for wireless as well as wireline segments. In the new global geopolitical situation, there is a large business opportunity for Indian telecom equipment vendors like us to become large exporter of trusted telecom products to the world, the company had said in its FY23 annual report.

Through its proactive policy interventions, the Government of India is committed to growing this sector. The management expects to benefit from policies such as PMI (Preference to Make in India), Design-linked PLI (Production Linked Incentive), TTDF (Telecom Technology Development Fund) and National Cyber Security Coordinator’s (NCSC) Trusted Sources directives.