Buy Tata Communications, target price Rs 1700: Emkay Global

Emkay Global has buy call on Tata Communications with a target price of Rs 1700. The current market price of Tata Communications is Rs 1406.4. Time period given by analyst is one year when Tata Communications Ltd. price can reach defined target.

Tata Communications Ltd., incorporated in the year 1986, is a Mid Cap company (having a market cap of Rs 40983.00 Crore) operating in Telecommunications sector.

Tata Communications Ltd. key Products/Revenue Segments include Telecommunication Services for the year ending 31-Mar-2021.



Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 4210.44 Crore, up 2.29 % from last quarter Total Income of Rs 4116.14 Crore and down -5.96 % from last year same quarter Total Income of Rs 4477.18 Crore. Company has reported net profit after tax of Rs 425.81 Crore in latest quarter.


Investment Rationale
With the full-fledged revenue revival being pushed to Q4 from Q3, the brokerage has cut FY22-24E revenue by 3-4%. This remains the only stumbling block now, but is key to the next leg of up-move. The brokerage retains Buy with an SoTP-based Dec’22 TP of Rs1,700 (Dec’23E EBITDA)

Promoter/FII Holdings
Promoters held 58.86 per cent stake in the company as of 30-Sep-2021, while FIIs owned 23.45 per cent, DIIs 7.63 per cent.