Tata Communications Reports Mixed Performance in Q4 2023 Financial Results

Tata Communications, a leading telecom provider in the industry, recently announced its financial results for the quarter ending December 2023. According to the data released on January 18, 2024, the company has seen a negative performance in this quarter, with a score of -19, which has improved from -20 in the last three months.

Despite the negative performance, there are some positive aspects to note from the financials. The company's net sales for the quarter were the highest at Rs 5,633.26 crore and have shown growth in each of the last five quarters. This indicates a very positive sales trend in the near term. Additionally, the net sales for this quarter have grown by 20.2% over the average net sales of the previous four quarters, which was Rs 4,685.22 crore.

The operating profit (PBDIT) for the quarter was also the highest at Rs 1,134.31 crore in the last five quarters, showing a positive trend in the near term. However, there are some areas that need improvement. The operating profit to interest ratio for this quarter was the lowest at 6.05 times and has fallen in each of the last five quarters. This suggests that the company's ability to manage interest payments is deteriorating.

The profit after tax (PAT) for this quarter was Rs 93.41 crore, which has fallen by -71.7% over the average PAT of the previous four quarters, which was Rs 330.20 crore. This indicates a very negative trend in the near term. The interest cost for this quarter was Rs 187.55 crore, which has grown by 36.48% quarter on quarter (QoQ). This signifies increased borrowings for the company.

The earnings per share (EPS) for this quarter was the lowest at Rs 1.57 in the last five quarters, indicating a decline in profitability and lower earnings for shareholders. The company's cash and cash equivalents for the last six half-yearly periods were the lowest at Rs 545.28 crore, showing a deterioration in short-term liquidity. The debtors turnover ratio for the last five half-yearly periods was also the lowest at 5.52 times, indicating a slower pace in settling debtors.

Overall, Tata Communications has shown a mixed performance in the quarter ending December 2023. While there are some positive aspects to note, there are also areas that need improvement. Investors should carefully consider these factors before making any investment decisions.