Tata Communications stock, which forms part of ace investor Rakesh Jhunjhunwala's portfolio, was trading 2.57 per cent lower at Rs 898 in the afternoon session today. 
Tata Communications stock, which forms part of ace investor Rakesh Jhunjhunwala's portfolio, was trading 2.57 per cent lower at Rs 898 in the afternoon session today. 
Shares of Tata Communications fell over 7 per cent today after the firm held an investor meet for June 2022. Tata Communications stock hit a 52-week low of Rs 856, losing 7.12 per cent in early trade against the previous close of Rs 921.65 on BSE.
Brokerage firm CLSA cut its target price to Rs 1,070 from the previous target of Rs 1,440.
"Management's margin guidance is 23 per cent to 25 per cent with Capex guidance of $300m. However, missing was specific revenue growth guidance," CLSA said.
The stock, which forms part of ace investor Rakesh Jhunjhunwala's portfolio, was trading 2.57 per cent lower at Rs 898 in the afternoon session today.
Rakesh Jhunjhunwala invested in the company through his wife Rekha Jhunjhunwala. As per the shareholding pattern of Tata Communications for the quarter ended March 2022, Rekha Jhunjhunwala owned 30,75,687 shares or a 1.08 per cent stake in the company.
Tata Communications stock has been falling for the last four sessions.
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Shares of Tata Communications are trading lower than 5-day, 20-day, 50-day, 100-day, and 200-day moving averages.
In one year, the stock has fallen 32.04 percent and lost 38.54 per cent this year. It touched a 52-week high of Rs 1,590 on January 17, 2022.
"The management guided at double-digit growth at its analyst meet to highlight its new age capabilities and growth opportunities but indicated that the near-term order-to-revenue cycle continues to remain stretched," said financial services firm Motilal Oswal.
"We expect 16 per cent EBITDA CAGR over FY22-2E. A revival in growth will be key to garnering better valuation. We maintain our Neutral rating," added Motilal Oswal.
The brokerage sees a 19 per cent upside in the stock at Rs 1,100 against the current market price of Rs 922, it said in a report.
Pavitraa Shetty, Co-founder & Trainer, Tips2Trades said, "Weak global markets with record high inflation has led to a sharp sell-off especially in stocks with a very high debt-equity ratio like Tata Communications. Technically, investors can buy for short term only if there is a green candle on the daily charts for targets of Rs 998- Rs 1020."
Tirthankar Das, Head of Technical Research, Ashika Group said, "Prices continue to remain in downtrend forming lower low and is on the verge of breakdown, signaling further downside in the coming session at the breach of crucial support level of Rs 880- Rs 890. The said level happens to be the 50% retracement of the entire rally since Mar'20 (High:1592; Low:200). Key observation is that stock seems to be sustaining above the 200 week exponential moving averages ( Rs 880- Rs 890) after five continuous months of decline. Hence, present support level at Rs 880- Rs 890 and the sequential decline since the start of CY22 seems to be part of the bullish harmonic group pattern ABCD which indicates that prices might change direction at a sustain close above Rs 1,000, till then outlook continues to remain neutral to negative with lower target of Rs 730- Rs 760 (61.8% retracement)."
Meanwhile, ICICI Securities maintained a buy call for the stock with a target price of Rs 1,600, a 73 per cent upside to the current market price of Rs 921.
"Tata Communications organised its annual investor day on June 14, 2022 where it shared certain lead indictors that helped appreciate the company's efforts to drive revenue growth, which was constrained by externalities particularly the supply of equipment.
It stated the company will continue adding to funnel, and improve conversion which should aid accelerate revenue growth as supply normalises. International market is the key focus area where it sees significant opportunity to drive growth; it would continue with its efforts to cement India market position.
Though data services revenue growth was disappointing in FY22, we continue to keep faith as management strategy is anchored at driving faster and durable growth. Our estimates remain unchanged with target price at Rs 1,600 (20x FY24E P/E). Maintain BUY," said ICICI Securities.
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