Shares of Tata Communications Ltd. experienced a substantial boost on Thursday, climbing 12.42 per cent to reach a high of Rs 1,827.85 after the Tata Group entity announced its robust second-quarter (Q2 FY27) financial results.
Strong Profitability and Revenue Growth
The telecommunications giant reported a consolidated net profit of Rs 341 crore for Q2 FY27, marking an impressive 86.2 per cent increase compared to Rs 183 crore in the corresponding period last year. This surge in profitability also saw the company's profit after tax (PAT) margin improve to 5.1 per cent from 3 per cent a year ago.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) for the September quarter rose 21.2 per cent year-on-year, reaching Rs 1,422 crore, up from Rs 1,174 crore in Q2 FY26. Consequently, the EBITDA margin expanded to 21.3 per cent from 19.2 per cent in the prior-year period. Tata Communications highlighted that this quarter marked its highest absolute EBITDA and fastest EBITDA growth.
The company's gross revenue for the quarter increased by 9.6 per cent year-on-year. Contributing to this growth, digital platform revenue saw a significant 18.6 per cent rise, while data revenue grew by 12.2 per cent year-on-year.
Digital Business Improvement and Strategic Focus
Tata Communications also noted an improvement in its digital business segment, with losses halving from the previous quarter and digital margins standing at (-)3.6 per cent. This indicates progress in monetizing its digital initiatives.
Ganesh Lakshminarayanan, MD and CEO of Tata Communications, expressed satisfaction with the results, stating, “I am pleased to report a stellar second quarter, with improved profitability across the business. Absolute EBITDA growth is a clear sign that our discipline and focus are paying off.” He further emphasized the company's strategic positioning in emerging technologies, adding, “As AI emerges as a powerful growth driver, our Unified AI Stack is resonating with customers as it helps bridge the gap between enterprise intelligence and enterprise action.”
Lakshminarayanan also highlighted continued strong demand for DC-to-DC connectivity, a structural growth opportunity where the company's extensive network assets and ongoing investments provide a distinct advantage. He concluded by expressing confidence in the momentum heading into the second half of the fiscal year.
Promoter Holdings
According to exchange data, promoters collectively hold a 58.86 per cent stake in Tata Communications, underscoring their significant investment in the company's future.