India’s telecom sector, comprising both cellular (wireless) and fixed line (wireline) services, reached a total of 1,207 million subscribers by May 2025, with 1,168 million wireless and 39 million wireline users. The national tele-density stood at 85.36%, with urban tele-density at 131.76% and rural at 59.33%, reflecting robust connectivity growth across the country.
With a market capitalization of Rs 51,532.28 crore, the shares of Tata Communications Ltd closing at Rs 1,808.15 per share, increased around 4.61 percent as compared to the previous closing price of Rs 1728.40 apiece.
Macquarie, one of the well-known brokerages globally, has given ‘outperforming’ rating on this telecom stock with a target price of Rs 2,300 apiece, indicating a potential upside of 27 percent from the Wednesday closing price of Rs 1,808.15 per share.
Macquarie sees Tata Communications’ stock potentially doubling in three years, driven by its leadership in digital infrastructure and enterprise transformation. The brokerage highlights strong growth in digital services, where the company consistently ranks among industry leaders. This optimism reflects Tata Communications’ strategic positioning in the evolving global digital ecosystem.
Further, Tata Communications’ ROIC declined from 16 percent (FY21–FY23 average) to around 11 percent in FY25, impacted by recent digital acquisitions. However, Macquarie anticipates a strong recovery, projecting ROIC to exceed 20% by FY28, nearing the firm’s 25% long-term target, assuming no major new acquisitions in the near term.
Tata Communications Limited offers digital transformation of enterprises globally. The Company’s Voice Solutions segment includes international and national long-distance voice services. Its Data Services segment includes core and connectivity services, digital platforms, and connected services.
In H1 FY25, the company recorded strong order book additions with high double-digit ACV growth, and no order cancellations reported, minor deal rollovers to Q1 FY26.
Deal wins were diversified across India, APAC, and Europe, including sectors like healthcare and telecom. The funnel remains robust with large deal representation, unaffected by U.S. tariff uncertainties, indicating sustained client confidence.
Written by Abhishek Singh
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