In just two years, Tejas Networks, a small-cap firm, increased by over 900%, or about $645 per share, becoming a multi-bagger. Due to the stock’s outstanding long-term performance over the past two years, investors’ wealth has risen by a factor of 10.
Only this year, the stock has surged by almost 68%. The stock is currently selling for more than 710 rupees a share on Dalal Street. The Tata Group supports the business, which is a major participant in the telecom industry.
Tejas Networks’ BSE stock ended the day trading at 710.50, up 16.55 or 2.38%. The share price earlier increased to a daily high of $717.
The company’s market worth is around $10,807.41 at the current pricing.
The shares were being traded on the BSE for 71.7 rupees each on October 16, 2020. Due to the weekend, the market was closed on October 17 and 18 of this year.
Based on a share price of $717, the shares have increased by at least 900% since this point. Comparing its most recent closing price of 710.50 per share to the preceding two years, Tejas stock has increased by at least 890.93%.
On October 16, 2020, investors who invested Rs. 1 lakh in Tejas Networks shares saw a return of 900%, increasing their value to almost Rs. 10 lakh.
The stock even reached a 52-week high on October 10 of this year, when it was trading at a price of 773 per share. The stock has increased by around 98% in less than 8 months since it reached a 52-week low of $359.50 per share on March 8, 2022.
On October 15, 2020, Tejas fell to its lowest point between October 2020 and the present with a unit price of 67.10. Since then, the shares have increased significantly with just a few minor corrections. Tejas Networks’ long-term stick, however, has not been good.
Tejas Networks’ 1-year returns are now around 37.26% greater than those of Bharti Airtel (15.07%), Vodafone Idea (-20.28%), Tata Communications (-15.21%), RailTel Corp (-24.36%), MTNL (8.4%), and OnMobile Global (-7.35%), according to the ICICI Direct website.
On July 29, Panatone Finvest, a unit of Tata Sons, reached an agreement to pay $1,884 crore, which included a $500 crore preferential stock allocation and $1,350 crore in warrants, to acquire a 43.35% share in Tejas Networks. An open offer to purchase 26% of Tejas Networks was made by Panatone and other specific Tata Group firms for $258 per share.
Panatone, a division of the Tata Group, owns 7,94,01,810 equity shares—or 52.40%—in Tejas as of June 30, 2022.
Tejas Networks’ combined net loss significantly dropped from 49.62 crore in Q4 FY22 to 6.64 crore in Q1 FY23. For Q1FY22, the firm reported a profit of Rs. 7.55 crore.
But compared to 126.50 crore in Q4 FY22 and 144.25 crore in Q1 FY22, consolidated revenue in Q1 FY23 was just 125.76 crore.
Tejas Networks reported a net loss of 117.13 crore and revenue of 550.59 crore as of March 31, 2022, respectively. The firm recorded excellent order flow and commercial momentum in FY22, which increased the order book by 73% year over year.
The government also authorised the firm for the PLI (Production Linked Incentive) programme and as a Trusted Source for telecom equipment.
In an effort to strengthen the whole value chain of telecom manufacturing and lessen India’s reliance on imports of networking and telecom goods from other nations, the PLI plan was introduced last year. Tejas Networks is favoured by the plan.
Additionally, Tejas successfully launched its domestic 4G RAN equipment on the commercial market in FY22 and finished proof-of-concept testing for an all-Indian 4G network.
A number of Tier-1 Indian telcos and ISPs chose the business for Metro DWDM and FTTX applications, and it also inked a new Tier-1 OEM in the USA. Additionally, the business won multi-million dollar contracts in Africa and Europe.
Earlier this month, Tejas successfully demonstrated a 4G/5G network and applications on a native end-to-end network utilising Indian hardware and software.
The whole range of cutting-edge wireless and wireline equipment from Tejas Networks and its affiliate Saankhya Labs was on display on the end-to-end network.
On October 21, Tejas will release its financial results for the second quarter of FY23.
Tejas Networks has been manufacturing the carrier-class, high-performance hardware needed to create communication networks since its foundation in 2000.
More than 75 nations use the company’s extensive selection of 4G/5G wireless, optical, broadband, and data networking equipment, which are used by telecommunications service providers, internet service providers, utility companies, defence and government organisations, and other organisations.
In a telecom network, Tejas devices are utilised in a number of places, such as cell towers, telecom exchanges, data centres, utility sites, and on client premises.
In a study last month for the whole telecom sector, Bank of Baroda analyst Jahnavi Prabhakar stated that the business is primed to grow even more in the coming years given the recent structural reforms and the launch of 5G connectivity.
The economist had said that it is important to take into account the sector’s past performance as India’s government gears up to usher in a new digital revolution in the coming months with the rollout of 5G services in the nation.
This has been investigated using information on the telecom sector’s loan share, ECB approvals in the industry, and auction revenues. The PLI strategy is expected to increase industrial output levels, create jobs, and support the sector over the next years.