Weak Q3 show, near term growth worries for Tata Communications

Most brokerages are, however, positive on the long term growth trajectory

Weak Q3 show, near term growth worries for Tata Communications

Ram Prasad Sahu Mumbai
The stock of network services major Tata Communications shed 5.4 per cent on Friday after its December quarter (Q3) performance missed Street estimates and led to downward revision of profit estimates.

Though brokerages are positive on the firm’s long-term prospects, led by the digital platform and services business, there could be near-term challenges on the revenue growth and margin expansion fronts.

The company’s consolidated revenues were flat on a sequential basis as a 3 per cent growth in the data business was offset by a sharp decline in voice and other segments. The voice segment, which accounts for 13-15 per cent of revenues, dipped 8.6 per cent sequentially and 17.8 per cent year-on-year (YoY) on the back of falling volumes and realisations.

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First Published: Jan 21 2022 | 8:47 PM IST

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