Rallis India Rallies 6%, Tejas Networks Drops on Widening Loss Amidst Tata Group Results
The Tata Group’s latest earnings update painted a mixed picture in the Indian stock market. On one hand, Rallis India posted a strong performance and saw its shares rise by almost 6 percent. On the other hand, Tejas Networks faced investor disappointment as its quarterly loss widened, pulling the stock down.
But what exactly happened with Tejas Networks, and what’s the outlook for investors going forward?
Tejas Networks Faces Sharp Drop in Q1 Results
Tejas Networks, a leading telecom and networking equipment provider under Tata Sons, reported a net loss of ₹194 crore in the first quarter of FY26. This is a major reversal from a net profit of ₹77 crore in the same period last year. Revenue also took a big hit, falling 87 percent year-on-year to just ₹202 crore, compared to ₹1,563 crore a year ago.
Such a steep drop in revenue shocked the market and triggered a negative reaction. The company’s stock price dipped by 10 percent during the day, reaching ₹630, before recovering slightly to close with a 5 percent loss.
Why Did Revenue Fall So Much?
According to company officials, the main reason behind this revenue fall was execution delays on large orders, especially related to the BSNL 4G rollout project. While Tejas secured contracts for nearly 18,000 sites, delays in shipping and installations meant that much of the revenue could not be recognized in Q1.
Another major concern was a drop in operational profits. The company posted an EBITDA loss of ₹136 crore, compared to a positive ₹230 crore last year.
What Are Experts Saying?
Market analysts believe that the results raise short-term concerns about execution capacity and project timelines. However, they also point out that the company’s order book is strong, standing at ₹1,241 crore, up 22 percent from the previous quarter.
This includes important contracts under BharatNet Phase 3, international partnerships like Rakuten Symphony, and private telecom providers who continue to invest in expanding their networks.
Investor Sentiment on Social Media
The news quickly drew reactions online. A tweet from @AimInvestments said:
“Tejas Networks suffers 87% drop in revenue, but order book stays strong. Watch out for next quarter recovery if execution improves.”
Another post from @cmagurvinder added:
“Strong technology, but poor execution, is dragging short-term performance. The company has to deliver to gain back market trust.”
Rallis India Shines Brightly
While Tejas struggled, Rallis India, another Tata company, brought cheer to investors. It reported a 22 percent increase in sales and nearly double the profit compared to the previous year. This drove a 6 percent rally in its stock price.
The company benefited from higher demand in its crop care and seed business, showing strength in India’s agri-focused sectors.
What Does This Mean for the Tata Group?
These contrasting results highlight how different sectors within the same group can perform very differently. While agri-businesses like Rallis are gaining from favorable market trends, tech and telecom arms like Tejas Networks are struggling with delivery and supply-side delays.
This also shows that investors need to look at company-specific fundamentals, even within large business groups like Tata.
Is There Hope for Tejas Networks?
Despite the current losses, many experts believe that Tejas Networks still has long-term potential. The company offers advanced technology solutions, including optical transmission, 5G networks, O-RAN, and fiber broadband (GPON). These are all areas with growing demand in India’s expanding digital economy.
If the company can resolve its delivery delays and speed up project completion, revenue could recover quickly in the coming quarters.
Tejas Networks Outlook for Investors
Here’s what investors should watch:
- Short-Term: Volatility is likely to continue due to weak Q1 performance
- Mid-Term: Execution on pending orders could lead to a bounce back
- Long-Term: Strong fundamentals in telecom tech could support steady growth
While it’s not a stock for the risk-averse right now, those with a long-term view might find a good opportunity at current price levels.
Conclusion
The Q1 results show a tale of two Tata companies. Rallis India impressed with strong sales and profits, while Tejas Networks struggled with losses and missed revenues. However, the strong order pipeline at Tejas leaves room for a comeback if the company can improve execution.
Investors should stay alert to how the company performs in the next two quarters. A bounce-back is possible, but not guaranteed. Cautious optimism may be the best stance for now.
Disclaimer
This content is for informational purposes only and not financial advice. Always conduct your research.