Tata Communications Q1 net profit jumps 236%
2 min read . Updated: 30 Jul 2020, 11:04 PM ISTTata Communications’ consolidated revenue grew 5.6% year-on-year (y-o-y) to ₹4,403 crore during the June quarter
Tata Communications Ltd reported a 236% surge in profit after tax to ₹258 crore in the quarter ended June, from ₹77 crore a year earlier. The massive rise in profit was driven by strong growth in data business, which also buoyed the company’s revenue during the quarter.
The telco’s consolidated revenue grew 5.6% year-on-year (y-o-y) to ₹4,403 crore during the June quarter. Revenue from data business rose 10% from a year ago to ₹3,604 crore due to robust performance across all segments despite uncertain economic environment.
The nationwide lockdown and the ensuing remote working led to increase in bandwidth usage and higher collaboration traffic, the company said in a statement.
“Enterprises have upgraded their capacities and are consuming more data to support this work model. Consequently, our India enterprise business grew 6.7% y-o-y and international enterprise business grew 8.3% y-o-y on the back of strong demand. This has led to increase in both revenue and profitability," the Tata group-company added.
Tata Communication’s consolidated earnings before interest, tax, depreciation and amortisation (Ebitda) was ₹1,042 crore for the June quarter, up 26.2% from a year ago. The firm’s margin of 23.7% expanded by 390 basis points (bps), both sequentially and y-o-y, on the back of strong growth in data business and focus on cost efficiencies.
The company benefitted from lower operating costs such as travel and office expenses on account of the lockdown, the telecom operator said.
“We have started this new financial year with strong performance amidst an uncertain and unpredictable economic environment. We remain focused on our strategy to deliver profitable growth and to be a preferred digital partner to our customers," said AS Lakshminarayanan, managing director and chief executive, Tata Communications.
On the operating metrics front, the company’s total active subscriber base declined to 5,297 in the first quarter of fiscal 2021 from 5,423 at the end of March quarter, but slightly higher than 5,210 customers in Q1FY20.
The company’s capex increased to ₹372 crore in the June quarter from ₹342 crore in the three months ended March. It reported net debt of ₹9,008 crore first quarter, a decrease of ₹168 crore from the preceding quarter.
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