Tejas Networks reported significant financial challenges in its Q3 FY25 results, with consolidated losses widening substantially compared to the previous year. The domestic telecom gear manufacturer faced headwinds primarily due to deferred orders from state-owned BSNL and reduced sales volumes.

Financial Performance Overview

The company's quarterly performance showed a stark contrast to the previous year, with key metrics reflecting the operational challenges faced during the period.

Revenue Composition and Market Presence

During the reported quarter, Tejas Networks maintained its focus on both domestic and international markets. The company's revenue mix, excluding operating revenue, comprised approximately 85% from the domestic market and 15% from international operations. This distribution highlights the company's continued dependence on the Indian telecom infrastructure market.

The company has been a key vendor for BSNL's 4G network deployment as part of the CDOT-TCS consortium and positions itself as the largest supplier of network routers in the domestic market. However, the quarter witnessed significant disruption due to the deferment of a substantial purchase order worth ₹1,526.00 crore from BSNL for 18,000 sites.

Inventory and Cash Position

Despite the revenue challenges, Tejas Networks maintained substantial inventory levels and cash reserves to support future operations.

The company indicated that its inventory of ₹2,363.00 crore maintained during the December quarter will be converted to finished goods and shipped in the upcoming months, suggesting potential revenue recognition in future quarters.

Business Development and Government Incentives

Tejas Networks achieved several strategic wins during the quarter, particularly in the emerging 5G segment. The company secured multiple contracts for private 5G deployments in India, focusing on specialized applications in ports and mining operations. Additionally, the company was selected as the 5G radio network supplier for a section of the Delhi-Mumbai railway corridor as part of Indian Railways' Kavach pilot project.

The company also benefited from government support through the Production Linked Incentive (PLI) scheme, receiving ₹84.95 crore during the quarter. This brought the total PLI incentives received by the company to ₹397.00 crore, demonstrating continued government backing for domestic telecom equipment manufacturing.

Outlook Considerations

The company's performance reflects the cyclical nature of telecom infrastructure spending and the impact of order timing on quarterly results. With substantial inventory levels and cash reserves, along with the deferred BSNL orders, the company appears positioned to navigate the current challenges while capitalizing on emerging opportunities in 5G and specialized network deployments.

Domestic telecom equipment manufacturer Tejas Networks reported a consolidated loss of ₹196.55 crore for the October-December quarter, marking its second consecutive quarterly loss. The significant decline was primarily attributed to reduced sales and deferred purchase orders from state-owned Bharat Sanchar Nigam Limited (BSNL).

Financial Performance Overview

The company's financial metrics showed substantial year-over-year deterioration during the reported quarter:

Revenue Composition and Market Presence

Tejas Networks serves as a key vendor for BSNL's 4G network deployment as part of the CDOT-TCS consortium and positions itself as the largest supplier of network routers in India. During the quarter, the company's revenue mix demonstrated strong domestic focus, with 85% coming from the domestic market and 15% from international operations.

A significant factor impacting quarterly performance was the delay of purchase orders worth ₹1,526 crore from BSNL for 18,000 sites. The company maintains substantial inventory valued at ₹2,363 crore as of December 2025, which management expects to convert to finished goods and ship in upcoming months.

Nine-Month Performance and Government Incentives

For the nine-month period ending December 31, Tejas Networks recorded:

The company received ₹84.95 crore as Production Linked Incentive (PLI) benefits during the reported quarter, bringing total PLI incentives received under the scheme to ₹397 crore.

Strategic Developments and Future Contracts

Despite financial challenges, Tejas Networks secured multiple contracts in emerging technology segments:

• Private 5G Deployments: Multiple wins for applications in ports and mining operations across India
• Railway Infrastructure: Selection as 5G radio network supplier for Delhi-Mumbai railway corridor section under Indian Railways' Kavach pilot project
• Technology Portfolio: Continued focus on network infrastructure solutions for both traditional and next-generation applications

The company's strategic positioning in critical infrastructure projects and substantial inventory levels indicate preparation for future order fulfillment, while government PLI support provides additional financial backing for operations.