Tata Group Stock Surges 12% as BSNL Receives ₹61,000 Cr Spectrum Boost for 5G Rollout
Tejas Networks Sees Massive Rally Amid BSNL 5G Expansion
Tata Group Stock : Shares of Tejas Networks Ltd, a Tata Group company specializing in data networking products, soared by 12% following the news of BSNL’s ₹61,000 crore spectrum allocation for its 5G rollout. This significant investment by the government in next-generation telecom infrastructure has sparked optimism among investors, fueling a sharp uptick in Tejas Networks’ stock price.
Stock Performance & Market Reaction
The company’s stock witnessed a sharp rise of 12%, reflecting strong investor confidence in its growth potential. Here’s a quick overview of the stock movement:
| Metric | Value |
|---|---|
| Current Price | ₹ 876 |
| Previous Close | ₹ 803.15 |
| Market Cap | ₹ 15,463.48 Cr. |
| Day’s High | ₹ 877.00 |
| Day’s Low | ₹ 803.15 |
The stock’s movement highlights the market’s enthusiasm over the potential revenue boost Tejas Networks could experience from BSNL’s large-scale 5G deployment.
Why Did the Stock Rally?
1. BSNL’s ₹61,000 Cr 5G Spectrum Allocation
The Department of Telecommunications (DoT) allocated premium 5G bands (700 MHz and 3300 MHz) to BSNL, enabling it to launch services in select cities, starting with Delhi. This move will allow Tejas Networks, a key 4G/5G RAN supplier to BSNL, to benefit significantly.
2. Strong Business Performance & Order Book Growth
In Q3 FY25, Tejas Networks reported:
- Net Revenues: ₹2,642 crores
- Profit After Tax (PAT): ₹166 crores
- EBIT: ₹260 crores
- PBT: ₹211 crores
- Order Book: ₹2,681 crores
The company has already delivered equipment for 27,000 sites in Q3 FY25, bringing total deployments in BSNL’s 4G/5G network to over 86,000 sites.
3. Expansion in Telecom & Broadband Infrastructure
- Vodafone Idea Contract: Tejas Networks has secured a 3-year deal to supply equipment for nationwide 4G/5G mobile backhaul networks.
- BharatNet Phase 3: The company is a key broadband equipment supplier for Last Mile Connectivity in Tamil Nadu, focusing on FTTX GPON technology.
These projects signal sustained revenue growth for Tejas Networks.
Financial Ratios & Key Metrics
| Financial Metric | Value |
|---|---|
| Market Cap | ₹ 15,449 Cr. |
| Stock P/E | 23.2 |
| Book Value | ₹ 212 |
| Dividend Yield | 0.00 % |
| ROCE (Return on Capital Employed) | 3.68 % |
| ROE (Return on Equity) | 2.06 % |
| Debt to Equity | 0.78 |
| EPS (Earnings Per Share) | ₹ 38.6 |
| Intrinsic Value | ₹ 654 |
| Graham Number | ₹ 429 |
| Industry P/E | 23.2 |
| DMA 200 | ₹ 1,024 |
| RSI (Relative Strength Index) | 63.6 |
Despite the stock’s strong rally, it remains below its 52-week high of ₹1,495, indicating room for further upside if fundamentals continue to strengthen.
Future Outlook & Growth Prospects
1. BSNL’s 5G Rollout to Boost Revenue
With BSNL set to launch 5G services nationwide, demand for Tejas Networks’ RAN equipment will likely increase.
2. BharatNet Expansion to Drive Fiber Optic Demand
Tejas Networks will benefit from the government’s focus on fiber broadband expansion under BharatNet Phase 3.
3. Private 5G & Global Expansion
Tejas Networks is conducting Proof of Concepts (PoCs) for private 5G networks and US telecom modernization, indicating future growth potential beyond India.
Management’s Take
Company executives remain optimistic about future growth, citing:
- Strong demand from BSNL, Vodafone Idea, and BharatNet
- Investment in next-gen telecom products
- Potential international expansion opportunities
Despite some challenges in government sector contracts, management is confident in navigating the evolving telecom landscape.
FAQs on Tejas Networks & BSNL’s 5G Expansion
1. Why did Tejas Networks’ stock rise by 12%?
Tejas Networks’ stock surged after BSNL received a ₹61,000 crore spectrum allocation for its 5G rollout. Since Tejas Networks supplies 4G/5G RAN equipment to BSNL, this news sparked investor optimism about future revenue growth.
2. What financial performance did Tejas Networks report in Q3 FY25?
The company posted net revenues of ₹2,642 crores, PAT of ₹166 crores, and an order book worth ₹2,681 crores, showing strong demand.
3. What contracts has Tejas Networks secured recently?
- A 3-year deal with Vodafone Idea for 4G/5G backhaul network equipment
- Supplier for BharatNet Phase 3 in Tamil Nadu for last-mile connectivity
4. What are the key growth opportunities for Tejas Networks?
- BSNL’s 5G expansion
- BharatNet fiber broadband deployment
- Private 5G and international projects
5. What is the current valuation of Tejas Networks?
The stock trades at a P/E of 23.2, with a book value of ₹212 and an intrinsic value of ₹654. It has a market cap of ₹15,449 crore.
Final Thoughts
Tejas Networks is positioned as a key beneficiary of India’s 5G expansion, particularly with BSNL’s standalone 5G rollout. With strong business fundamentals, expanding contracts, and an improving financial profile, the company’s long-term growth potential remains robust.
Would you invest in Tejas Networks after this news? Let us know in the comments!
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.