- 21 Jul 2022
- ICICIdirect Research
MARGINS RESILIENCE SURPRISE POSITIVELY
TATACOMM - 1841 Change: -10.15 (-0.55 %)News: Topline came in at Rs 4311 crore, up 5.1% YoY & up 1.1% QoQ, largely in line with expectations with data revenues (forming ~78% of the revenues) up ~7.6% YoY (up 1.2% QoQ) at Rs 3340 crore. Consolidated EBITDA margin was at 25% (up 95 bps YoY and up 47 bps QoQ) aided by lower administrative cost. Data EBITDA margin was at 29%, down 30 bps QoQ. The company reported a PAT of Rs 544 crore, up 83.6% YoY, aided by higher other income which majorly included tax refunds and interest on the same and lower depreciation and interest costs. There was also sequential decline in net debt by ~Rs 812 crore QoQ on the back of a healthy FCF.
Views: While revenue growth is on gradual recovery trajectory along with continued cash flow generation and debt reduction, margin resilience was a positive surprise. Tata Communication remains a key beneficiary of new normal of hybrid work structure, increased conferencing needs thereof and overall digitisation at enterprise levels.
Impact: Positive