Nelco Ltd. , a Tata Group satellite communication service provider, has signed a groundbreaking agreement with Eutelsat to deliver OneWeb low Earth orbit (LEO) satellite connectivity services across India. This strategic partnership aims to revolutionize satellite communication in the region, offering secure and low-latency connectivity for customers on land, sea, and air.

Expanding Connectivity Reach

The collaboration between Nelco and OneWeb India Communications, Eutelsat's local operating entity, will extend service coverage across India's borders, territorial waters, and remote regions. This expansion is set to support a wide range of government and enterprise applications, strengthening India's digital infrastructure and national security while ensuring connectivity in underserved areas.

Service Offerings and Applications

Nelco plans to offer these advanced LEO connectivity services as soon as OneWeb's operations become commercially available in India. The partnership is poised to address critical needs across various sectors:

• Land-based Services: Providing high-speed, low-latency connectivity for businesses and communities in remote and rural areas.
• Maritime Connectivity: Ensuring reliable communication for vessels in Indian territorial waters.
• Aviation Solutions: Offering seamless connectivity for aircraft, enhancing in-flight communication and operational efficiency.
• Government and Enterprise Applications: Supporting secure and advanced communication needs for critical sectors.

Leadership Perspectives

P J Nath, Managing Director and Chief Executive Officer of Nelco, expressed enthusiasm about the partnership, stating, "This partnership marks a significant step in enabling reliable, secure, and high-speed communication solutions based on LEO services for critical sectors across land, sea, and air. It reflects our strategy to provide comprehensive multi-orbit satellite connectivity services for advancing India's digital ecosystem and supporting the country's strategic communication needs."

Neha Idnani, Regional Vice President for APAC and Director of OneWeb India, added, "We are proud to partner with Nelco, part of the respected TATA Group, to deliver advanced LEO connectivity services in India. This agreement strengthens our strategic footprint in one of the world's most dynamic and fast-growing connectivity markets and underscores our commitment to supporting India's digital and security ambitions."

About Nelco and Eutelsat

Nelco Ltd., a part of the $180 billion Tata Group, is a leading Satellite Communication Service Provider in India. The company aims to create a ubiquitously connected world, empowering businesses and communities while enabling nation-building endeavors.

Eutelsat Group, formed through the combination of Eutelsat Communications and OneWeb in 2023, is a global leader in satellite communications. With a fleet of 34 Geostationary (GEO) satellites and a Low Earth Orbit (LEO) constellation of more than 600 satellites, Eutelsat Group addresses the needs of customers in key verticals including Video, Mobile Connectivity, Fixed Connectivity, and Government Services.

This partnership between Nelco and Eutelsat represents a significant leap forward in satellite communication technology for India, promising to bridge digital divides and enhance connectivity across the nation.

NELCO , a prominent player in the Indian telecommunications sector, has released its financial results for the first quarter, revealing a significant decline in profitability and EBITDA, with flat revenue growth.

Revenue and Profit

NELCO reported flat revenue for the first quarter, with the top line remaining steady at ₹74.00 crore. However, the company experienced a substantial drop in its bottom line. The consolidated net profit for Q1 decreased to ₹1.80 crore, down from ₹4.50 crore in the same quarter of the previous year. This represents a significant reduction in profit of approximately 60%.

EBITDA and Margin Decline

NELCO's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) also saw a considerable decline. The EBITDA decreased to ₹7.80 crore from ₹12.20 crore in the same quarter last year, representing a significant year-over-year reduction of 36.07%.

The company's EBITDA margin also witnessed a notable decline. It decreased to 10.40% from 16.50% year-over-year, indicating a squeeze on the company's operational efficiency and profitability.

Financial Overview

To provide a clearer picture of NELCO's Q1 performance, here's a summary of the key financial metrics:

Stock Performance

Following the announcement of these results, NELCO's stock price reacted negatively. The stock fell by 5.30% to ₹897.50, reflecting investor concerns about the company's financial performance.

Conclusion

The significant drop in profitability, EBITDA, and EBITDA margin, coupled with flat revenue growth, presents a challenging picture for NELCO. These results could be a concern for investors and stakeholders. It will be crucial for NELCO to address the factors contributing to these declines in the coming quarters to ensure long-term financial health and shareholder value.

As the telecommunications industry continues to evolve rapidly, NELCO's ability to adapt to market changes, manage costs effectively, and capitalize on new opportunities will be key to improving its financial performance in future quarters.