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Tata Communications Ltd Stock Analysis

Large Cap
Evaluated by 1827 users | BSE: 500483 | NSE: TATACOMM |
Telecommunication - Service Provider

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Tata Communications Ltd has performed well in some of the past ten years indicating its past ten year financial track record is somewhat good
Value Creation
 Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21TTM
Return on Capital Employed 2.93%5.05%4.44%6.4%3.98%4.58%4.91%0.75%3.09%10.72%-
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 4,0924,4164,3764,3194,7905,0685,2525,3895,7506,2256,327
Y-o-Y Gr. Rt.-7.9%-0.9%-1.3%10.9%5.8%3.6%2.6%6.7%8.3%-
Adjusted EPS (Rs.) 4.3111.9311.8719.3212.1514.9615.661.478.132.0134.23
Y-o-Y Gr. Rt.-176.8%-0.5%62.8%-37.1%23.1%4.7%-90.6%451%295.2%-
Book Value per Share (Rs.) 250.42263.73276.69293.05312.13324.74308.89287.68288.44318.12323.57
Adjusted Net Profit 12334033855134642644641.8231912976
Net Op. Cash Flow (Rs. Cr.) 1,2141,5951,2041,4619089711,0291,2481,1081,647-
Debt to Cash Flow from Ops 1.120.490.780.40.750.760.510.360.490.35-
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Tata Communications Ltd. should be analysed on a Standalone basis
CAGR
CAGR Colour Code Guide
  10 yrs 5 yrs 3 yrs 1 yr
Net Sales 4.8%5.4%5.8%8.3%
Adjusted EPS 25%21.4%26.9%295.2%
Book Value per Share 2.70.4110.3
Share Price 21.8% 16.4% 44% 44.8%
Key Financial Parameter
Performance Ratio Colour Code Guide
 Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20Mar'21TTM
Return on Equity (%) 1.744.644.396.784.014.74.940.492.8110.5510.67
Operating Profit Margin (%) 24.1522.6522.823.819.8123.5424.1722.7527.3431.8631.12
Net Profit Margin (%) 37.77.7312.757.238.418.50.784.0214.6515.42
Debt to Equity 0.190.10.120.070.080.080.060.060.070.060.06
Working Capital Days 607740730753471240226236226210141
Cash Conversion Cycle -54-40-52-53-37-38-37-42-51-47-
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Entity Percentage Holding
Promoters 58.86%
Institutions 31.08%
Non-Institutions 10.06%
Pledged *3.193.193.903.903.903.903.904.964.964.96
* Pledged shares as % of Promoter's holding (%)
Past 10 year's financial track record analysis by Moneyworkds4me indicates that Tata Communications Ltd is a average quality company.

Tata Communications Ltd's earnings have grown by 21.4%, whereas share price has appreciated 16.4% CAGR over the past five years, indicating the company’s share price is likely undervalued. However, for specific investment actions please consult your investment advisor.

Tata Communications Ltd share price has appreciated 21.8% annually (CAGR) over the past ten years.

Past 10 years financial track record analysis and assessment of future prospects by Moneyworks4me indicates that Tata Communications Ltd is an average long term investment. However, you need to ensure you buy at a right price to earn good returns.

Tata Communication, incorporated in 1986 is part of the $62.5 billion Tata Group. The company, formerly Videsh Sanchar Nigam (VSNL), was acquired from the Government of India. It is leading global provider of a new world of communications. It provides a range of services that includes transmission, IP, converged voice, mobility, managed network connectivity, hosting and storage, managed security, managed collaboration and business transformation for global

Tata Communication, incorporated in 1986 is part of the $62.5 billion Tata Group. The company, formerly Videsh Sanchar Nigam (VSNL), was acquired from the Government of India. It is leading global provider of a new world of communications. It provides a range of services that includes transmission, IP, converged voice, mobility, managed network connectivity, hosting and storage, managed security, managed collaboration and business transformation for global enterprises and service providers, as well as Internet, retail broadband and content services for Indian consumers. Tata Communications has most advanced & largest submarine cable networks. Tata Communications is listed on the Bombay Stock Exchange and the National Stock Exchange of India.

Business area of the company

Tata Communications is a digital ecosystem enabler that powers today’s fast-growing digital economy.

Products & Solutions

  • Network
  • Cloud
  • Security
  • Mobility & IoT
  • Unified Communications
  • Carrier Services
  • Media & Entertainment
  • Content Delivery Network
  • Resources

Awards

2000-01

  • VSNL received the best ISP award from PC Quest magazine in 2000

2003-04

  • VSNL has received various other awards and certifications including the ‘Top International long distance (ILD) Operator’ and the ‘Top Internet Service Provider’ awards at the Voice & Data 100 annual awards.

2006-07

  • World Communications Awards, 2006 - LONDON
  • TelecomAsia Awards, 2006 - PHUKET
  • 2006 Global Wholesale Telecommunications Awards - AMSTERDAM

2007-08

  • Atlantic ACM Excellence in Wholesale 2008.
  • Frost & Sullivan #1 Enterprise Data Services Provider in India 2007
  • Best Wholesale Carrier at the Telecom World Middle East 2007
  • Best Pan-Asian Wholesale Provider at the Capacity Global Awards 2007
  • Telecom magazine Tele.net’s award for Best Long Distance Operator
  • Tele.net’s award for the Best Internet and Broadband Operator

2008-09

  • Global Telecoms Business Innovation Award for International Wholesale Infrastructure Transformation and International Network Infrastructure Transformation
  • 2008 Telephony Award for Most Innovative Managed Service
  • Best Market Strategy at 2008 Global Wholesale Telecommunications Awards
  • Frost & Sullivan #1 Enterprise Data Services Provider in India 2008

2009-10

  • Best Global Wholesale Offering Award from Capacity magazine, one of the most important publications for telecommunications carriers and service providers
  • Global Telecoms Business Innovation Award for International Wholesale Infrastructure Transformation and International Network Infrastructure Transformation
  • European CEO announced Tata Communications as Telepresence Managed Service Provider of the Year 2009
  • Frost & Sullivan named the Company 1 Enterprise Data Services Provider in India 2009
  • In March 2010, Tata Communications entered the Gartner’s Magic Quadrant for Global Network Service Providers.
  • Frost & Sullivan’s 2009 Product Innovation award for Managed Telepresence Service.
  • “Best service coverage” in the 2009 Optical Transmission Vision (OTV) APAC Network Operator Awards

2010-11

  • ‘Top international long distance operator’ award from Voice & Data magazine in India, consecutively for the 9th successive year since 2001 (India)
  • ‘Best global wholesale offering’ award from Capacity magazine, a global publication for telecommunications carriers and service providers
  • ‘Telepresence managed service provider of the year’ at the European CEO 2010 Awards
  • ‘Service provider of the year’ in enterprise data services and hosted contact centre services at the Frost & Sullivan 2011 India IT & Telecom Excellence Awards
  • ‘Best service provider of the year, APAC’; and ‘best ethernet wholesale service, APAC’ at the 2010 MEF
    Awards
  • ‘APAC service provider of the year 2011 (Ethernet and telepresence)’ at the Cisco Partner Summit 2011
  • ‘Best long distance operator (India)’ at the Tele.net Telecom Operator Awards 2011.

2011-12

  • Hosted Contact Center Service Provider of the Year by Frost & Sullivan 2011 India IT & Telecom Excellence Awards
  • Enterprise Data Service Provider of the Year by Frost & Sullivan 2011 India IT & Telecom Excellence Awards
  • IPX+ framework is ranked third (tied) in innovation across all aspects of the wholesale telecom business, first in terms of go-to-market strategy in Ovum’s Wholesale Innovation Analyzer 2011
  • Global Wholesale Telecommunications Award - Capacity Awards 2011; Best Global Offering
  • Best Long Distance Operator (India) Tele.net Telecom Operator Awards 2011
  • Best Wholesale International Telecom Asia Award 2011
  • Best APAC Wholesale Ethernet Service, APAC 2011 - MEF Carrier Ethernet Service Provider Awards 2011
  • Best Business Service, APAC 2011 - MEF Carrier Ethernet Service Provider Awards 2011
  • APAC Service Provider of the Year 2011 (Ethernet and Telepresence) - Cisco Partner Summit 2011

2012-13

  • Tata Communications won the Best Asian Wholesale Carrier Award at the 2012 Capacity Awards, which recognize wholesale players who have established themselves at the forefront of the wholesale telecom industry by applying innovative processes and strategies.

2014-15

  • Gartner’s Magic Quadrant for Network Services, Global
  • Frost & Sullivan 2015 Best Practices Award - India ICT Awards
  • Frost & Sullivan 2014 Asia Pacific ICT Award
  • 2014 Frost & Sullivan Best Practices Awards
  • Frost & Sullivan 2014 India ICT Awards

2015-16

  • A 2016 Best Employer in India by Aon Hewitt
  • Gartner’s Magic Quadrant for Network Services, Global
  • Frost & Sullivan 2016 Best Practices Award - India ICT Awards

2016-17

  • Gartner’s Magic Quadrant for Network Services, Global
  • A 2017 Best Employer in India and Hong Kong by Aon Hewitt
  • Ranked 19th in the Top 25 companies in India (2017) -– Linkedin
  • Certified as Great Place to Work in India (2017) - Great Place to Work Institute

2017-18

  • Gartner Magic Quadrant for Network Services, Global, 2018
  • Gartner Magic Quadrant for Managed Hybrid Cloud Hosting, Asia / Pacific, 2017
  • 2017 Frost & Sullivan India Digital Transformation Awards
  • NetFoundry clinched the IoT & Cloud Innovation Award Innovation Leader – IoT
  • Managed UC Services Provider of the Year (second year running)
  • TechXLR8 Asia Awards 2017
  • Ovum Industry Congress On The Radar Awards 2017 – Internet of Things
  • MEF 2017 Awards

2018-19

  • Certified a Great Place to Work in Canada, Greater China, India, Hong Kong and Singapore, ranking high as an equal opportunities employer, with inclusive workplace policies and a high-trust, high performance culture
  • Tata Communications is positioned in the top percentile of NPS, amongst the best in the industry
  • Stevie Awards Bronze (for sales and customer service)
  • Leader in Gartner’s 2019 Magic Quadrant for Network Services, Global
  • Aon Best Employers, India 2018 for third year in a row and in Hong Kong for the second consecutive year
  • CX Strategy Summit & Awards - Best Customer Experience 
  • Clarabridge Customer Experience Innovation Award
  • Major Player in the IDC MarketScape: Asia/Pacific Managed Security Services 2018 Vendor Assessment
  • People Matters Total Rewards as ‘Best in Employee Volunteering’
  • Telecom Review Summit - Best Customer Service Provider
  • Customer Fest Show- CX Leader of the Year Award
  • Positioned in the Forrester Wave, Managed Security Services in Asia Pacific, Q1 2019
  • Three MEF 2018 Awards: Wholesale Service Provider of the Year- APAC; Enterprise Application of the Year – Financial and Enterprise Application of the Year – Retail
  • NetEvents 2018 IoT & Cloud Innovation Award: Innovation Leader: IoT
  • Cisco Partner Summit 2018 Awards: Software Partner of the Year
  • MEF Awards - Proof of Concept: MEF 3.0 Implementation; MEF 3.0 Inter-carrier servicer for Automated Discovery and Blockchain Settlement
  • 2019 Frost & Sullivan Best Practices Awards - Asia Pacific: Managed UC Services Provider of the Year (third year running)
  • TechXLR8 Asia Awards 2018: Best IoT Partnership 
  • Two Carriers World Awards: Best IoT initiative and Best IPX Service Provider
  • 2019 Frost & Sullivan Best Practices Awards: Global Hybrid Cloud Services Product Line Strategy Leadership Award and Sub Saharan African IoT MVNO Visionary Innovation Leadership Award
  • Six awards at the Frost & Sullivan 2018 India ICT Awards Telecom Asia Readers’ Choice awards: IoT/M2M Solution Innovation of the Year

2019-20

  • F&S Managed Multi Cloud Service Provider of the Year 2019
  • F&S Cloud Interconnect Service Provider of the Year Award
  • F&S 2019 Unified Communications Service Provider of the Year
  • F&S 2019 Managed Video Services Company of the Year
  • F&S 2019 Enterprise SIP Trunking Service Provider of the Year
  • F&S 2019 AsiaPacific Managed UC Service Provider of the Year
  • F&S 2019 SDWAN Service Provider of the Year
  • F&S 2019 AsiaPacific Managed SDWAN Service Provider of the Year Award
  • Everest Network Transformation & Managed Services Peak
  • MEF SD-WAN Provider Of The Year - APAC Gartner Magic Quadrant for Network Services, Global F&S Managed Security Services Provider of the Year (Telco)
  • CX Vendor Excellence Asia 2019 Award
  • Customer Experience Leader of the Year 2019
  • IHS Markit (Omdia) Leader in CDN Vendor Scorecard CCW Asia Excellence awards- Bronze award for Best Customer Service

Milestones

  • 2004: VSNL became the first telecom service provider globally to achieve TL 9000 – Quality Management System Certification, a set of quality system requirements and metrics designed specifically for the telecom industry, encompassing ISO 9001 and other best practices.
  • 2004: the Company launched calling cards, an important avenue to raise call volumes.
  • 2004: VSNL established an intelligent network (IN) platform that allows multiple IN services
  • 2005: VSNL has built Tata Indicom India Singapore Cable System and acquired Tyco Global Network
  • 2006: The Company acquired Tata Power Broadband, now known as VSNL Broadband Limited, having about 1000 kilometres of optical fibre infrastructure in Mumbai and Pune; acquired the assets of 7 Star.com Pvt. Limited, a suburban cable operator in Mumbai offering broadband services and acquired Direct Internet Limited which provides internet and related services predominantly to small and medium sector enterprise customers
  • 2007: VSNL acquired two entities in India, Direct Internet Limited (DIL) and VSNL Internet Services Limited (VISL).
  • 2010-11: Company has launched the world’s leading dedicated global video network called Video Connect, which is designed to help broadcasters, studios and production houses deliver video content flexibly and cost-effectively to media hotspots worldwide.
  • 2011-2012: the Company has launched a Web Based Training Module on the Tata Code of Conduct available to all its employees globally.
  • 2012-13: the Company launched a subsea cable system connecting several countries in the Middle East to Mumbai, India
  • 2015-16: Tata Communications Group launched the IZOTM Private Cloud service to bring to CIOs unprecedented control over their public and private clouds and entire data centre sphere.
  • 2016-17: Tata Communications Group launched the latest addition to its IZO Cloud Enablement Platform called IZO SDWAN, SDWAN standing for Software Defined Wide Area Networking.
  • 2017-18: The company launched three IZOTM Private Cloud nodes in Germany, the UAE and in Malaysia.
  • 2018-19: the company acquired 31,960 cumulative non-convertible Redeemable preferance share of smart ICT Private Limited.
  • 2019-20: The Group through its wholly owned subsidiary, Tata Communications (Netherlands) BV acquired an additional ownership interest in Teleena Holdings (B.V) (Teleena) of 64.64% for a cash consideration of Rs 105.40 crore.
  • 2021: Tata Communications announced its partnership with Google Cloud to drive cloud adoption and transform Indian businesses.
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323

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