Tejas Networks Q1 FY27 Earnings Call: International 5G Wins Strengthen Growth Outlook Despite Continued Losses

What Happened ?

Tejas Networks Q1 FY27 Earnings Call focused on improving business momentum following a challenging FY26. Management highlighted growing international demand for its wireless portfolio, continued expansion in optical networking, increasing adoption of AI-driven telecom infrastructure and positive developments surrounding the BSNL expansion project.

The company also discussed its long-term roadmap across 5G, AI networking, optical transport and future 6G technologies while reaffirming confidence in returning to profitability through revenue growth, operating leverage and improved working capital management.

key details

Revenue Recovery Continues:

• Revenue increased 21% QoQ to ₹402 crore.
• PBT loss narrowed compared with Q4 FY26.
• Inventory reduced during the quarter.
• Cash balance improved to ₹589 crore.
• Order book increased modestly to ₹1,529 crore.

Note:

• Management indicated financial recovery is progressing, although profitability remains dependent on higher business volumes and improved working capital.

International 5G Business Gains Momentum:

• First commercial end-to-end 5G network deployment secured in South America.
• First significant shipment of 5G Massive MIMO radios delivered to a European customer through NEC.
• Selected by a global Tier-1 telecom operator for a joint 5G R&D project.
• Growing international traction for wireless products.

Note:

• Management expects these initial deployments to create additional expansion opportunities with existing telecom operators and strengthen global references.

BSNL Expansion Remains a Major Catalyst:

• BSNL 26,000-site expansion order remains under final discussion.
• Management expects the order to be finalized during the current quarter.
• Acceptance testing for existing deployments is nearing completion.
• Receivable collections from BSNL are expected to improve significantly.
• AMC revenues are expected to commence over the coming quarters following warranty completion.

Note:

• Management believes the BSNL expansion will improve inventory utilization, working capital and long-term profitability.

Optical Networking Business Expands:

• Continued supply of 100G and 400G DWDM equipment.
• Growth supported by:
  • 5G backhaul deployment.
  • Enterprise connectivity.
  • Data centre networking.
  • Residential broadband expansion.
• Utility communication modernization remains a strong growth segment.

Note:

• Optical networking continues to benefit from increasing bandwidth requirements across telecom and enterprise infrastructure. 

AI Infrastructure Creates Long-Term Opportunity:

Management believes AI adoption will significantly increase telecom infrastructure demand through:

• Higher data centre interconnect capacity.
• Growth in AI inference networks.
• Expansion of 50G PON broadband.
• Evolution toward 5G-Advanced and 6G.
• Development of 1.6 Tbps DWDM optical technologies.

Note:

• The company continues investing in next-generation networking products expected to support AI-driven traffic growth through 2030.

Innovation and Technology Progress:

• Filed 46 new patents during Q1 FY27.
• Global patent portfolio increased to 722 patents.
• 380 patents already granted.
• Data centre interconnect product shortlisted among the top three globally at the Leading Lights Awards 2026.
• Successfully completed field trials for Direct-to-Mobile (D2M) broadcasting technology.

Note:

• Management views continued R&D investment as a critical differentiator in both domestic and international telecom markets.

Profitability Roadmap:

Management identified key priorities for returning to profitability:

• Increase domestic and international revenues.
• Expand global partnerships, including NEC.
• Improve operating leverage.
• Reduce inventory and receivables.
• Lower finance costs through better working capital.
• Generate recurring AMC revenues from BSNL deployments.

Note:

• Management indicated that achieving positive EBITDA and PAT could reasonably take 12–18 months, subject to business execution and order inflows.

Risk Analysis

Summary:

• Although Tejas Networks is seeing encouraging traction in international 5G and optical networking, future profitability depends on timely execution of large telecom projects, receivable collections and successful commercialization of next-generation technologies.

Key Risks:

• Delay in BSNL expansion order.
• Slower recovery of receivables.
• High working capital requirements.
• Continued operating losses.
• Delays in commercialization of AI and 6G products.
• Competitive pressure from global telecom equipment manufacturers.

Worst Case:

• If the BSNL expansion order is delayed further or international 5G deployments fail to scale into larger contracts, the company’s return to profitability could be pushed beyond current management expectations.

Risk Level: Medium

Company Commentary

• International demand for Tejas wireless products continues to improve.
• The South American 5G deployment validates the company’s end-to-end telecom technology stack.
• AI infrastructure is expected to become a major long-term growth driver.
• BSNL expansion remains in the final stages of award.
• Management remains optimistic about achieving sustainable revenue growth and profitability over the medium term.