Tejas Networks

Tejas Networks reported a net revenue of INR 202 crores for Q1 FY26, a significant decrease from INR 1,907 crores in Q4 FY25. The company incurred a loss of INR 194 crores, which was higher than the losses in the previous quarter. EBIT level profitability was negative INR 232 crores, and PBT was negative INR 297 crores, with finance costs contributing approximately INR 75 crores to the PBT loss. The primary reason cited for the revenue shortfall was the delayed receipt of purchase orders and shipment of approximately 18,000 sites for the BSNL 4G network, which were expected in Q1.

The order book at the end of Q1 FY26 stood at INR 1,241 crores, an increase from Q4 FY25. The company anticipates winning a substantial order of approximately INR 1,500 crores for the deployment of BSNL's 4G network expansion sites (18,000+ sites), with receipt expected shortly and execution planned within the current financial year. The current order book composition is 92% India and 8% international, reflecting a continued dominance of the India business.

Tejas Networks has expanded its portfolio and market reach through strategic initiatives. A partnership with Rakuten Symphony aims to develop integrated 5G Open RAN solutions for global customers, combining Rakuten's CU/DU with Tejas's radio units. Collaborations with Intel, Lava, and HMD are focused on integrating SL-3000 D2M chipsets into laptops and D2M-enabled mobile phones. The company also launched a 1.2 terabit per wavelength DWDM solution and received an initial order for a private 5G deployment, marking an important entry into this application.

At the end of Q1 FY26, inventory stood at INR 2,537 crores, slightly higher than the previous quarter, primarily to cater to expected purchase orders. Trade receivables were high at INR 4,453 crores, largely due to the BSNL 4G project, with collections linked to project milestones. The company collected approximately INR 650 crores during the quarter, and advances against receivables amounted to INR 1,460 crores. Cash position was INR 545 crores, while borrowings increased to INR 3,990 crores, mainly for working capital and capex investments.

The quarter saw a decrease in employee costs, primarily due to provision reversals related to certain employee exits and variable pay. However, management clarified that employee costs are expected to increase going forward^⏳, aligning with ongoing investments in R&D and international sales. This indicates that the Q1 reduction was a one-off^📎 event and not a sustained trend.

Tejas Networks plans to continue investing in R&D and developing its supply chain to support its expanded product portfolio. Capex is expected to progressively increase from last year's level of INR 650 crores, influenced by NEC-related investments. Management anticipates that a significant portion of these investments will occur this year, with some potentially trickling into the next financial year.

The deployment of BSNL's 4G network is progressing, with radios deployed and functioning satisfactorily on over 90,000 sites, though optimization efforts are ongoing. For BharatNet Phase-III, Tejas received its first order for IP routers as a supplier to System Integrators (SIs) who won tenders in various circles. The company is actively engaged with SIs for the supply of its routers and has received initial orders.