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    Tejas Networks Q1 FY26 earnings call

    TEJASNET
    Telecommunication·14 Jul 2025
    Management Summary

    Tejas Networks reported a challenging Q1 FY26 with significantly lower revenue of INR 202 crores and a net loss of INR 194 crores, primarily due to delays in BSNL 4G project shipments and other customer-related issues. Despite the revenue shortfall, the company's order book increased to INR 1,241 crores, with an anticipated INR 1,500 crore order for BSNL's 4G expansion. Strategic partnerships and new project wins, including a first private 5G order, signal future growth, though profitability was impacted by fixed costs against lower sales.

    Highlights

    5

    • Order book at end of Q1 FY26 was INR 1,241 crores, higher than Q4 FY25.

    • Anticipates winning an order of ~INR 1,500 crores for BSNL 4G network deployment, expected to be received shortly.

    • Received an initial order for private 5G deployment under BSNL's Captive Non-Public Network initiative, marking an important first step.

    • Secured first order for BharatNet Phase-III for the supply of IP routers.

    • Received PLI incentives of INR 122 crores for Q3 FY25.

    Concerns

    4

    • Net revenue for Q1 FY26 was INR 202 crores, significantly lower than Q4 FY25 revenue of INR 1,907 crores.

    • Reported a net loss of INR 194 crores, which was higher than Q4 FY25 losses.

    • EBIT level profitability was negative INR 232 crores.

    • Trade receivables stood at INR 4,453 crores at the end of Q1.

    Key financials

    Single quarter

    08 metrics
    1. 01Net Revenue₹202 Cr-89.4%QoQ
    2. 02Net Loss₹194 Cr
    3. 03EBIT₹-232 Cr
    4. 04PBT₹-297 Cr
    5. 05Inventory₹2,537 Cr

    Order Book

    high confidence

    Total Value

    ₹ 1,241 crores

    as of 2025-06-30

    quantified

    Composition

    Mix2 geographys
    • India92.0%
    • International8.0%

    Share of order book by geography

    Pipeline

    L1 awaiting loa

    Expected order for BSNL 4G network deployment for 18,000+ sites

    Cancellations / Deferrals

    • deferred:Delayed receipt of PO and shipment of ~18,000 BSNL 4G network sites, and other customer delays in shipment, clearances, and inventory arrival.

    "The current order book of INR 1,241 crores does not include the anticipated INR 1,500 crore BSNL 4G order, which is expected to be received and executed this financial year."

    Source:
    Prepared remarks

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Capex

    Capex disclosed

    Debt

    Gross ₹3,990 crores · Net ₹3,445 crores

    Liquidity

    Cash ₹545 crores

    Guidance & targets

    6
    CategoryTargetPriority
    Order Execution
    BSNL 4G expansion order execution
    INR 1,500 crores order executed
    		High
    Operating Costs
    Employee costs
    continue to increase
    		Medium
    Business Development
    New 4G/5G business closures
    some new business closures
    		Medium
    Balance Sheet
    Trade receivables reduction
    reasonable reduction
    		Medium
    Capex
    Capex
    progressively increase a little bit
    		Medium
    Revenue
    Revenue from NEC-related investments
    wins and project closures
    		Medium

    What to watch in Q2 FY26

    5

    BSNL 4G Expansion Order Receipt

    Shortly, within this financial year.
    CurrentAnticipated order of ~INR 1,500 crores, intimated but not yet received.
    TargetReceipt of the ~INR 1,500 crore order.

    Why it matters

    This is a significant order expected to drive future revenue and is currently in the pipeline.

    We also expect and we have been intimated for winning an order of ~INR1,500 crores for the deployment of the BSNL expansion sites of 18,000-plus in BSNL's 4G network, and we expect to be in receipt of the order shortly.

    Risks & concerns

    3
    RiskSeverity

    Significant Revenue Shortfall in Q1 FY26

    Net revenue of INR 202 crores was substantially lower than the previous quarter's INR 1,907 crores, primarily due to delayed BSNL 4G POs and shipments, as well as other customer and inventory-related delays. — Management acknowledged

    high

    Negative Profitability (EBIT and PAT)

    The company reported a negative EBIT of INR 232 crores and a net loss of INR 194 crores, mainly driven by lower revenues against significant fixed costs, despite some margin improvements. — Management acknowledged

    high

    High Trade Receivables

    Trade receivables stood at INR 4,453 crores, with a large portion linked to the BSNL 4G project, and collection is dependent on project milestones. — Management acknowledged

    medium

    Q&A highlights

    8

    “Okay. From this quarter, we've kind of stopped giving that breakup because what we realized was that those numbers didn't have the clarity because a lot of the India revenue that we claimed as India Private based on the end customer, the direct customer was a private entity. But sometimes there are government as the end customer and a private end customer as well. So that number was not very clear. That's why we kind of left it as India and International.”

    Explains a change in reporting metric, impacting historical comparisons for segment analysis.

    asked by Pranav Kshatriya

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 FY26 Financial Performance Overview

    Tejas Networks reported a net revenue of INR 202 crores in Q1 FY26, a significant decline from INR 1,907 crores in Q4 FY25. This led to a net loss of INR 194 crores and a negative EBIT of INR 232 crores, primarily due to lower revenues against substantial fixed costs. Finance costs contributed INR 75 crores to the negative PBT of INR 297 crores.

    02

    Order Book and BSNL 4G Project Outlook

    The company's order book stood at INR 1,241 crores at the end of Q1 FY26, an increase from the previous quarter. Management anticipates winning an additional order of approximately INR 1,500 crores for the deployment of 18,000+ sites in BSNL's 4G network, which is expected to be received and executed within the current financial year. The Q1 revenue shortfall was largely attributed to delays in the receipt of this BSNL PO and other customer-related shipment and inventory issues.

    03

    Strategic Partnerships and Product Portfolio Expansion

    Tejas Networks highlighted new strategic partnerships, including with Rakuten Symphony for integrated 5G Open RAN solutions and with Intel, Lava, and HMD for D2M-enabled chipsets and mobile phones. The company also expanded its portfolio with advanced 5G Massive MIMO radios, a field-proven 4G/5G core through NEC licensing, and enhanced optical products like 1.2 terabit per channel DWDM systems.

    04

    Domestic Project Wins and Market Opportunities

    The company secured its first order for BharatNet Phase-III for IP routers and an initial, albeit small, order for private 5G deployment under BSNL's Captive Non-Public Network initiative, marking an important entry into this application area. They also continued to win run-rate orders for DWDM equipment from Tier 1 Indian telcos and critical infrastructure sectors like railways and defense.

    05

    Balance Sheet and Capital Allocation

    Inventory levels increased slightly to INR 2,537 crores to cater to anticipated purchase orders. Trade receivables remained high at INR 4,453 crores, with a large portion tied to the BSNL 4G project, though management expects a reasonable reduction over the next few quarters. Borrowings increased to INR 3,990 crores, primarily for working capital and ongoing capex-related investments in R&D, supply chain, and NEC-related projects, with capex expected to progressively increase.

    06

    Outlook and Growth Drivers

    Management expressed bullishness on growth drivers, citing strong global demand for data and bandwidth, and continued investments in R&D and sales. They anticipate new business closures in 4G/5G this year and expect significant growth from their expanded product portfolio and strategic partnerships with NEC and Rakuten, which aim to access global customers.

    This is an AI-generated summary of a publicly available earnings call transcript.