Buy Tata Communications, target price Rs 1461: ICICI Securities

ICICI Securities has buy call on with a target price of Rs 1461. The current market price of Tata Communications Ltd. is Rs 1253.1. Time period given by analyst is one year when Tata Communications Ltd. price can reach defined target.

Tata Communications Ltd., incorporated in the year 1986, is a Mid Cap company (having a market cap of Rs 35572.28 Crore) operating in Telecommunications sector.

Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 4130.95 Crore, down -2.37 % from last quarter Total Income of Rs 4231.05 Crore and down -6.86 % from last year same quarter Total Income of Rs 4435.22 Crore.
Investment Rationale
The company expects ROCE expansion despite reinvestment which implies much faster EBIT growth. TCom is seeing changing consumer behaviour with vendor consolidation and everything on internet has put the company in an advantageous position. The brokerage expects EBIT CAGR of 21.8% over FY21-25E, but it sees an upside risk to the estimate.

Promoter/FII Holdings
Promoters held 58.9 per cent stake in the company as of March 31, 2021, while FIIs held 24.9 per cent, DIIs 7 per cent and public and other 9.2 per cent.


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