Shares of Tejas Networks, a Tata Group company, dropped as much as 10% intraday on Tuesday, reacting to a sharp revenue decline and widening losses. The slump followed Tata Consultancy Services (TCS) reporting a revenue decline attributed primarily to the delay in BSNL’s 4G rollout project—a key contract involving both companies.
Tejas Networks’ stock eventually closed 6.6% lower at ₹653.25 on the BSE, after touching an intraday low of ₹629.65.
In the April–June 2025 quarter (Q1 FY26), Tejas Networks reported a significant 89% drop in revenue, falling to ₹202 crore from ₹1,907 crore in the previous quarter. Its net loss widened to ₹194 crore, up from ₹72 crore in the previous quarter, due to project execution delays and shipment issues.
According to Arnob Roy, Chief Operating Officer of Tejas Networks, a major factor was the delayed purchase order (PO) from Bharat Sanchar Nigam Limited (BSNL) for an additional 18,000 4G sites. “We were expecting to execute it in Q1, but the order got delayed,” Roy said on the company's earnings call.
Roy further revealed that in addition to the BSNL delay, Tejas Networks experienced shipment clearance delays and inventory arrival issues with other clients. These logistical hurdles contributed to the revenue shortfall and compounded operational challenges.
However, a BSNL official pushed back, stating there was no delay from the telco's end, suggesting possible internal delays within Tejas or procedural holdups in order finalization.
Tejas Networks and TCS had been heavily dependent on the ₹19,000 crore BSNL mega contract awarded in May 2023, one of the largest deals in the Indian telecom sector. TCS had awarded ₹7,492 crore of this contract to Tejas Networks for supplying telecom equipment, particularly Radio Access Network (RAN) solutions.
During the course of the 24-month agreement to deploy 100,000 4G sites, both companies saw revenue surges, with Tejas Networks experiencing triple-digit quarter-on-quarter growth and contributing 60%-80% of its revenue to this single project.
Following the original contract's conclusion in May 2025, BSNL placed a follow-up purchase order worth ₹2,903 crore with TCS for 18,685 additional 4G sites. Tejas Networks was allocated a ₹1,525.53 crore share of this order.
However, delays in purchase order finalization and approval have stalled execution. TCS’ Chief Financial Officer Samir Seksaria clarified during their earnings call: “We just received an advance purchase order. We are awaiting circle-wise POs. Once received, execution will begin.”
This delay has directly impacted TCS’s financials, contributing 2.8 percentage points to its 3.1% sequential revenue decline in the June quarter.
The stock market’s reaction to the earnings reports of both companies underscores the vulnerability of over-reliance on a single large project. While TCS has a broader portfolio to absorb such shocks, Tejas Networks' limited exposure to other revenue streams made it more susceptible.
Going forward, analysts suggest that diversification of client base and reducing dependency on a single contract will be essential for Tejas Networks to regain investor confidence and financial stability.