Tejas Networks to execute 50% orders in next 2-3 quarters; sees reduced govt dependence

Tejas Networks is in focus on the back of its Q1FY22 earnings. The year-on-year (Y-o-Y) revenue growth looks up owing to the low base last year, but there have been around 30 percent decline in revenue sequentially. However, their orderbook has continued to grow.
The revenues in the current Q1 were up 80 percent at Rs 144.25 crore versus Rs 80.1 crore and EBITDA was up at Rs 17.6 crore versus Rs 0.6 crore in the year-ago period.
In an interview with CNBC-TV18, Sanjay Nayak, MD & CEO of the company, discussed the quarterly performance and business outlook. First up, he said that the company is confident, FY22 will see significant revenue growth over FY21.
On orders from the government, he said that they have reduced their dependence on business from the government and that 98 percent of new orders have been from private Indian companies and international businesses. “The government orders, while we have won a lot of business but because of lockdowns etc, the outlook from government orders has been slow. What we feel good in terms of how the business is shaping up, is the focus on run-rate business; the non-government business has been very good and that is growing well,” he said.
Nayak further mentioned that 50 percent of the orders in hand would be executed in the next 2-3 quarters.
Sharing details about receivables, he said, “BSNL continues to be a challenge as it has been for the last 4-5 quarters, although we continue to receive small amounts of money. Other than BSNL, don’t have any sticky receivable from the government side. Some of the receivables are seasonal, like a lot of customers could not pay on time in Q1 but some of the money has already come in this current quarter. In another two quarters or so, receivables including BSNL should come back to normal and working capital would also get back to normal.”
“Inventories have continued to reduce over four quarters; revenues have continued to increase. So, overall things are coming back on track,” said Nayak.
With regard to new orders, Nayak said, “We have won a lot of tenders from state utility companies, RailTel, and such kind of companies and those should be converted into purchase orders.” He further added, “What we report as orders is the orders that we have in hand and new purchases from those tenders would come in subsequent months and quarters.”
For the entire interview, watch the video.