Tejas Networks Limited, promoted by Panatone Finvest Limited – a subsidiary of Tata Sons Private Limited, is a wireline and wireless telecom and data networking products company that designs, develops and manufactures high-performance and future-ready products for building high-speed communication networks that carry voice, data and video traffic from fixed line, mobile networks and solutions for broadband, satellite and broadcast applications.
The company’s products are differentiated by a programmable, software-defined hardware architecture that provides flexibility, multi-generation support and a seamless software-enabled network transformation to its customers.
Tejas customers include telecommunications service providers, internet service providers, web-scale internet companies, utility companies, defence companies and government entities. The Company also exports its products to overseas territories.
With a market cap of Rs. 4,800 crores, the shares of Tejas Networks Limited were trading in the green at Rs. 595 on Tuesday, as against its previous closing price of Rs. 593.85 on BSE. The stock has delivered negative returns of around 50 percent in one year, and has rose by over 1.33 percent in the last one month.
Management Commentary
In Q1 FY26, Tejas Networks’ trade receivables stood at Rs. 4,453 crore, with collections of ~Rs. 650 crore during the quarter. While trade receivables remained elevated, the company highlighted that against these receivables, there were advances of about Rs. 1,460 crore recorded under other liabilities, thereby reducing the net receivable position to that extent.
A large part of the receivables is on account of the BSNL 4G project, along with other receivables. When asked whether these would be collected by the September balance sheet or remain for a longer duration, management stated that they expect a “reasonable reduction” in receivables within the current financial year, while only a small portion may extend beyond, depending on milestone completion. The majority of the receivables is expected to be realised during this year.
Inventory increased to Rs. 2,537 crore in Q1 FY26 compared to Rs. 2,367 crore in Q4 FY25. The company noted that this inventory is expected to be converted into finished goods and shipped in the upcoming months.
At the end of Q1, the company’s cash position stood at Rs. 545 crore, while borrowings were at Rs. 3,990 crore. The rise in borrowings was attributed primarily to working capital requirements and certain capex-related investments made over the past quarters.
During Q1 FY26, BSNL’s 4G expansion project commenced, and TCS, the company’s systems integration partner, received the Advance Purchase Order (APO) for over 18,000 sites. TCS has indicated that the expected value of the purchase order for the supply of RAN equipment from Tejas will be around Rs. 1,500 crore, with management expecting execution within FY26.
Management stated that the business is being driven by continuing growth in data consumption, which is fueling investments in fixed and mobile networking technologies worldwide. Key applications include data centre connectivity, led by the establishment of new AI data centres; the continued digitalisation of cities and economies; the modernisation of utility networks; significant investments in broadband connectivity; and the global expansion of 4G and 5G networks. These factors together serve as important drivers for the company’s business growth.
Management noted that the addressable market for the company’s products is expected to grow globally, with domestic opportunities driven by significant network investments in both private and government sectors due to rising bandwidth demand. The company has secured several new customers and application wins, which are expected to expand further in the current year.
The company continues to invest in R&D, supply chain, and product portfolio expansion, with capex expected to be at or slightly above last year’s Rs. 650 crore, including additional spending related to the NEC collaboration, the majority of which is planned for FY26 with some spillover into FY27. The company also received Rs. 122 crore in Q3 FY25 under the Production Linked Incentive (PLI) scheme.
For FY26, the company’s key business drivers include the significant expansion of its product portfolio in FY25, which has increased its addressable market, including support for 5G over multiple bands, advanced 5G maMIMO radios, a field-proven 4G/5G Core, an expanded IP/MPLS router family, enhanced optical portfolio with 800G/1.2T DWDM systems, and an enhanced FTTx portfolio with XGSPON products.
The company has secured several new customers and application wins in both sectors, which are expected to expand in FY26. Partnerships with NEC and Rakuten are expected to provide access to global customers and joint go-to-market opportunities, while an expanded global sales footprint and strategic initial wins are expected to drive strong momentum in increasing international business.
Management remains “bullish” on growth prospects, citing strong demand fundamentals, an expanded product portfolio, and global partnerships. The company plans to continue investing in R&D and sales infrastructure to support future growth.
Financial Highlights & More
In Q1 FY26, Tejas Networks reported a consolidated revenue from operations of Rs. 202 crores, a steep decline of around 89 percent QoQ and 87 percent YoY. The decline was primarily driven by delays in purchase order (PO) receipts, inventory arrivals, and shipment clearances for certain customers.
The company reported a net loss of Rs. 194 crore for the quarter, representing a deterioration of nearly 169 percent QoQ and a reversal from a net profit of Rs. 77 crore in Q1 FY25.
In terms of financial ratios, Tejas Networks has reported a RoE of 12.8 percent and ROCE of 15.5 percent, with a debt-to-equity ratio of 0.89. Further, the stock is currently trading at a P/E of 59.4, compared to the industry average of 59.1. The closing order book for Q1 FY26 stood at Rs. 1,241 crore, higher than Q4 FY25. This figure excludes the BSNL 18,000-site order valued at ~Rs. 1,500 crore.
Closing Thoughts
Tejas Networks faced a soft Q1 FY26 due to order delays, but management remains confident about a recovery in the upcoming months. They expect a “reasonable reduction” in trade receivables this year, supported largely by the execution of the BSNL 4G expansion project (with a Rs. 1,500 crore order) and other milestone-linked collections.
Inventory built up in Q1 is expected to convert into shipments in the coming quarters, driving revenue growth. With a robust pipeline across government and private sectors – both domestic and international – new customer wins, an expanded product portfolio supported by strategic partnerships with NEC and Rakuten, and continued investments in R&D and infrastructure, the company is well-positioned for growth.
While elevated receivables and working capital intensity remain key monitorables, the combination of strong demand fundamentals and improved execution makes profitability in H2 FY26 a realistic expectation.
Written by Shivani Singh
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