Tejas Networks Faces Significant Financial Challenges Amidst Declining Sales and Increased Leverage

Tejas Networks, a small-cap player in the Telecom Equipment & Accessories industry, has experienced significant volatility, hitting a new 52-week low of Rs. 549.3 today. This marks a continued decline, with the stock underperforming its sector by 0.58% and recording a drop of 3.86% over the past two days. Currently, Tejas Networks is trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a bearish trend.
In terms of financial performance, the company reported a staggering 87.08% decline in net sales for the quarter ending June 25, alongside a substantial loss of Rs. 193.87 crore in profit after tax, reflecting a 350.2% decrease. The debt-equity ratio stands at 0.89, the highest in recent times, suggesting increased leverage.

Institutional investor participation has also waned, with a 1.08% reduction in stakes over the last quarter, now holding 10.86% of the company. Despite a long-term growth trajectory in net sales and operating profit, the stock has underperformed significantly, with a one-year return of -54.34%, contrasting sharply with the Sensex's modest gain of 0.22%.