Shares of Tata Communications fell in early trade on Thursday after the company reported a 27% year-on-year decline in consolidated net profit to ₹183.21 crore for the September quarter, even as revenue rose 6.5% to ₹6,099.75 crore. 

Earnings review

Tata Communications' September-quarter results showed steady top-line growth supported by data and digital services, but profitability weakened due to higher costs. 

Data revenue rose 7.3% year-on-year to ₹5,179 crore, while the company's digital portfolio grew 14.9%, reflecting continued traction in emerging technology segments like cloud networking and voice AI. Revenue from voice solutions declined 4.5% to ₹406 crore.

Analyst view

SEBI-registered analyst A & Y Market Research said Tata Communications' second quarter (Q2) performance was a“mixed bag,” as revenue growth remained healthy, but profit margins narrowed. 

The firm highlighted that the company's digital portfolio continues to drive momentum, aided by strong project wins and strategic positioning in the digital transformation space.

According to the analyst, the overall outlook remains positive as investors appear to be factoring in the company's long-term growth potential rather than short-term margin pressures.

Brokerage view

Brokerage firm Nuvama maintained a 'Buy' rating on Tata Communications, raising its target price to ₹2,235 from ₹2,020. It said the company remains an“attractive play” that combines the stability of telecom with the growth opportunity of IT services.

Nuvama said margins in FY26 are expected to remain under pressure, but seea  gradual recovery in FY27. The brokerage trimmed FY26 EBITDA estimates by 7% while keeping FY27 nearly unchanged.

What are technical charts suggesting?

A & Y Market Research said the stock recently broke out above the ₹1,853–₹1,880 resistance zone with strong volumes, signaling improving market sentiment. 

Sustaining above this range could attract fresh buying interest, with the next potential levels seen at ₹1,910 and ₹1,940.

What is the retail mood on Stocktwits?

On Stocktwits, retail sentiment was 'extremely bullish' amid 'extremely high' message volume.

Tata Communications' stock has risen 13% so far in 2025.

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