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Tejas Networks, a leading provider of telecom equipment and solutions, experienced a significant surge in its share price, soaring by 10% in early trading on October 21. This surge was driven by the company's robust 4G business expansion, which resulted in a seven-fold increase in revenue. The company's management expressed strong confidence in upcoming opportunities and highlighted several key projects for which it is actively pursuing bids and contracts.
The company's strong financial performance in the second quarter of fiscal year 2025 is evident in its impressive quarter-on-quarter growth. Net profit surged by 250%, while revenue rose by 80% compared to the previous quarter. This growth was largely fueled by the company's involvement in the pan-India network expansion of Bharat Sanchar Nigam Limited (BSNL), the state-run telecom company. Additionally, Tejas Networks secured new orders for 4G sites in several circles and is currently conducting proof-of-concept trials for 5G upgrades within the existing 4G band for BSNL.
Tejas Networks is actively seeking opportunities in both wireless and wireline network expansion across the globe. The company has identified several key targets, including the pan-India 4G network expansion and the 5G upgrade for BSNL. The company is also participating in the third phase of the BharatNet project, a government initiative aimed at providing broadband connectivity to rural areas. Tejas Networks has previously supplied broadband access equipment for the first two phases of this project and is now seeking to secure contracts for the latest phase, which carries a value of around Rs 65,000 crore.
Beyond BSNL, Tejas Networks is targeting opportunities in the railway sector, specifically the Collision Avoidance System - Kavach - tender. The company is awaiting the opening of the tender and the commencement of bidding. In the private sector, Tejas Networks is developing a private 5G application for a large enterprise, with trials currently underway. In the wireline business, the company sees significant potential in the BharatNet Phase II expansion and has submitted bids along with multiple partners for contracts. Tejas Networks has also secured a contract for Dense Wavelength-Division Multiplexing (DWDM) equipment from a major Indian telecom player for capacity expansion. DWDM is an optical fiber multiplexing technology that enhances the bandwidth of existing fiber networks.
Tejas Networks is also actively pursuing international markets, with strong traction for its GPON and DWDM products in the Americas and Africa. GPON is a standard for Passive Optical Networks (PON), a technology used for delivering broadband access via fiber optic cable. The company has recently secured a network modernization order in the United States and is experiencing increased engagement for its wireless products in both India and overseas markets.
The Indian government's commitment to expanding telecom connectivity and fostering 6G research presents significant opportunities for Tejas Networks. Telecom Minister Jyotiraditya M Scindia announced the government's goal of achieving 100% coverage of villages with telecom connectivity within the next 12 months. The government is also actively encouraging the development of 6G technology in India, aiming to become a key player in 6G technology and manufacturing by 2030. These initiatives provide a favorable environment for Tejas Networks to capitalize on its expertise and technology, further solidifying its position in the rapidly evolving telecom sector.
Source: Tejas Networks shares up 10% powered by 4G expansion, says confident of upcoming opportunities