Tata Communications new building at Bandra Kurla Complex, in Mumbai on February 21, 2010. Photograph: ABHIJIT BHATLEKAR/MINT (for Budget Issue)AI Quick ReadShares of Tata Communications gained 5.6% in intraday trade on Thursday (April 23), hitting a two-month high of ₹1,609 apiece, as investors reacted positively to the company’s March quarter performance. Analysts, too, largely maintained their estimates, helping the stock record its biggest single-day gain in over two months.
The company delivered a steady Q4 performance, with 11.5% YoY and 6% QoQ growth in data revenue, driven by acceleration in digital portfolio growth and 4.5% YoY growth in core connectivity.
Consolidated gross revenue grew 9.4% YoY and 6% QoQ to ₹6,550 crore, coming in line with analysts’ estimates. Revenue from the Data Services segment, which accounts for the bulk of total revenue, stood at ₹5,704 crore, up from ₹5,121.55 crore in the same period last year.
The company reported an EBITDA of ₹1,284 crore, a 14.4% increase from ₹1,122 crore in Q4 FY25. EBITDA margins stood at 19.6%, 90 basis points higher than the 18.7% recorded in the March 2025 quarter.
On the bottom line, the company reported a ₹263">consolidated net profit of ₹263 crore, down 65.44% from ₹761 crore in the same period last year, primarily due to a higher tax outgo (partly related to prior periods). For FY26, adjusted PAT grew around 7% YoY to ₹1,100 crore.
Motilal Oswal Financial Services said the company’s order book remains strong, with healthy double-digit YoY growth, driven by large deal wins in international markets. The deal pipeline remains robust, with the digital portfolio contributing around 70%.
JM Financial also noted that the company’s order book grew strongly in double digits YoY in Q4 FY26, supported by multiple deal wins across various data business segments. The international order book also saw strong growth during the quarter.
According to Motilal Oswal, the company has transitioned through two phases—first achieving balance sheet discipline and then investing in digital capabilities both organically and inorganically. It is now entering a third phase focused on profitable growth and capital discipline. Management aims to improve execution while maintaining strategic continuity.
As the company reported an in-line performance in Q4, JM Financial has retained its ‘Buy’ rating on the stock with a target price of ₹1,980 per share. The brokerage’s target price is based on a 10x FY28 EV/EBITDA multiple for the data segment, as it expects segment EBITDA to grow at a robust CAGR of 20% over FY26–29E.
Motilal Oswal has valued the company's data business at 9x FY28E EV/EBITDA and the voice and other businesses at 4x EV/EBITDA to arrive at a revised target price of ₹1,720 while retaining its ‘Neutral’ rating. The brokerage believes that acceleration in data revenue growth, along with margin expansion, remains key for a re-rating.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
Ksheera Sagar has been working as a Market Research Analyst at LiveMint for the past four years, covering stocks, commodities, and broader financial markets. In this role, he closely tracks daily market movements, corporate earnings, sector trends, and macroeconomic developments.
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