Tejas Networks Q3 Loss Hits ₹197 Crore on BSNL Order Deferral

Introduction

Tejas Networks, a domestic telecom equipment manufacturer, reported a consolidated net loss of ₹196.55 crore for the third quarter ended December 31, 2025. This marks the second consecutive quarter of losses for the company, a stark contrast to the ₹165.67 crore profit recorded in the same period last year. The significant downturn is primarily attributed to a sharp decline in sales, compounded by the deferment of a major purchase order from the state-owned telecom operator, BSNL.

Financial Performance Overview

The company's financial results for the October-December period highlight severe operational headwinds. Consolidated revenue from operations witnessed a staggering 88% year-on-year decline, falling to ₹306.79 crore from ₹2,642 crore in the corresponding quarter of the previous year. This substantial drop in income directly contributed to the reported loss, reversing the profitability trend seen a year ago.

The BSNL Order Deferral

A key factor behind the weak quarterly performance was the delay in a significant purchase order from BSNL. Tejas Networks is a crucial vendor for BSNL's 4G network rollout as part of the CDOT-TCS consortium. During the quarter, a purchase order valued at ₹1,526 crore for 18,000 network sites was deferred. This delay had a direct and substantial impact on the company's revenue recognition for the period, leading to the reported sales shortfall.

Nine-Month Financial Analysis

The challenging conditions are also reflected in the company's performance for the nine-month period ending December 31, 2025. Tejas Networks recorded a cumulative loss of ₹697.55 crore over these three quarters. Revenue from operations for this period stood at ₹793.69 crore, marking an 89% decline from the previous year. The sustained pressure on both revenue and profitability underscores the difficulties faced by the company throughout the fiscal year.

Operational Health and Inventory Management

Despite the revenue challenges, Tejas Networks maintains a significant inventory level, valued at ₹2,363 crore as of the December 2025 quarter. The company stated that this inventory will be converted into finished goods and shipped in the upcoming months, suggesting a potential for revenue recovery as delayed orders are fulfilled. The company's cash position at the end of the quarter was reported at ₹537 crore. The order book stood at ₹1,329 crore, providing some visibility for future revenue streams.

Revenue Mix and Strategic Wins

During the reported quarter, the domestic market continued to be the primary source of business, accounting for approximately 85% of the revenue mix, while international markets contributed the remaining 15%. On a positive note, the company has secured multiple wins for private 5G deployments in India, targeting applications in sectors like ports and mines. Furthermore, Tejas Networks was selected as the 5G radio network supplier for a section of the Delhi-Mumbai railway corridor for the Indian Railways' Kavach pilot project.

PLI Incentives and Management Outlook

Tejas Networks also benefited from the government's Production-Linked Incentive (PLI) scheme. The company received ₹84.95 crore in PLI incentives during the quarter, bringing the total incentive received under the scheme to ₹397 crore. Arnob Roy, COO of Tejas Networks, noted that Q3 revenue was driven by sales of wireline products to private and international customers. He also mentioned ongoing field trials for wireless products, with commercial negotiations expected to conclude in the coming months. CFO Sumit Dhingra highlighted a 17% quarter-on-quarter revenue growth and a reduction in net debt, indicating efforts in managing working capital.

Conclusion

Tejas Networks' third-quarter results reflect a challenging period dominated by the deferral of a large BSNL order, which severely impacted its revenue and pushed the company into a loss. While the headline numbers are weak, the company's substantial inventory, healthy order book, and strategic wins in the private 5G and government sectors provide a potential pathway to recovery. The fulfillment of the delayed BSNL order will be critical for the company's performance in the upcoming quarters.