Tejas Networks' revenue grows 30% in Q2 FY26, but provisions lead to loss

Tejas Networks reported Q2 FY26 revenue of INR 262 crores, a 30% quarter-on-quarter increase from INR 202 crores in Q1. However, the company experienced a profit after tax loss of INR 307 crores, compared to INR 194 crores in Q1. This loss included INR 190 crores in additional provisions for inventory and warranty-related matters, primarily due to contract manufacturing process losses, design changes, and inventory obsolescence. Excluding these provisions, EBIT would have been negative INR 205 crores and PBT negative INR 284 crores. The order book stood at INR 1,200 crores, with 93% from India and 7% international.

The company's strategic focus includes the nationwide 4G network deployment for BSNL, with 97,500 cell towers running on Tejas' 4G RAN products. Tejas also launched its new 64T64R massive MIMO radio and achieved its first 5G RAN deployment under BSNL's captive non-public network program. In the wireline business, Tejas secured additional BharatNet Phase-3 orders for IP/MPLS routers and introduced a 1.2 Tbps DWDM transmission system.

Inventory at the end of the quarter was INR 2,383 crores, with receivables at INR 4,026 crores, largely tied to BSNL 4G order-related collections expected in the next 2-3 quarters. Borrowings for the quarter amounted to INR 4,166 crores, primarily for working capital and CAPEX related to product portfolio expansion.