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Semiconductor shortage impact likely to continue in the second half of the next year as well affecting the margins for Tejas Networks

Semiconductor shortage impact likely to continue in the second half of the next year as well affecting the margins for Tejas Networks

Published on 22 October 2021 Views 13 Comments 0
  • In FY-22, India private will be the fastest growing business segment for the company.
  • In International market, Africa is doing very well for the company.
  • Semiconductor shortage impact likely to continue in the second half of the next year as well. Margin impact was 240 to 250 basis point in Q2 due to the shortage.
  • Won plenty of tenders from BSNL, Railways, fire, Utilities, etc but converting them into revenues will take time.
  • Seasonality: H2 (second half of the financial year) is better as compared to H1. 
  • Optical and broadband access: Globally competitive to reach out to much larger customer base.
  • R&D: Planning to invest in wireline, wireless side, 4G, 5G space. In the 4G and 5G space looking at both organic and inorganic investment opportunities.
  • Order book profile: India + International consists of 45% of the order book whereas Indian Government related orders is 55%.
  • Indian government orders are in the 3 categories: 1.) Critical Infrastructure like Railways, Power, Oil and Gas, Defense, Smart cities. 2.) BSNL/BBNL (Bharat Broadband Network Limited): Department of telecom related.

3.) BSNL, at the company level.

  • Working capital cycle will get normalized to 130-140 days in the next few quarters.
  • BSNL credit is around 100 crores. Partly has been repaid and remaining will be paid in the coming quarters.
  • More color on the synergies with the tata group will be given in the next few weeks post the open offer decision given by the TATA Sons.
  • Large part of manufacturing is outsourced by the company. They mostly do assembly. Company has got the approval w.r.t the PLI (Production linked incentive) scheme for telecom equipment manufacturing.

Originally Published On: https://blog.investyadnya.in/tejas-networks-q2fy22-conference-call-highlights/

 

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