Powering global data and broadband networks

Tejas Networks designs, develops and sells high-performance and cost-competitive networking products to telecommunications service providers, internet service providers, utilities, defense, and government entities in over 75 countries. Tejas products utilize programmable, software-defined hardware architecture with a common software code-base that delivers seamless upgrades of new features and technology standards. Tejas Networks is ranked among top-10 suppliers in the global optical aggregation segment and has filed 350 patents.

Tejas has an extensive portfolio of leading-edge networking products for building end-to-end broadband networks, based on the latest technologies and global standards. Tejas products include carrier-grade optical transmission (based on DWDM/PTN/OTN technologies), fiber broadband (based on GPON/NG-PON), broadband wireless (based on LTE 4G/5G) as well as multi-gigabit Ethernet/IP switching and routing products that are fully designed and manufactured in India. Tejas products utilize a novel software-defined hardware architecture that enables deliver highly differentiated network solutions. Tejas is also one of the leading innovators in India’s ICT sector, with over 350 patents and a large repository of 300+ silicon IPs, and is amongst the top listed companies in India, who spend a large percentage of their revenues in R&D.

All large private telecom operators, telecom PSUs, and utilities in India use Tejas products in their networks. Tejas is also the leading domestic supplier of optical and data networking products for various Government of India projects of national importance, having security/strategic implications, such as National Fiber Optic Network (BharatNet), defense networks, and Smart Cities. Tejas GPON products are installed in over 70,000+ Gram Panchayats and 2500+ towns across India for BharatNet project.

2021 was a game changing year for Tejas Networks, when on July 29, 2021, Panatone Finvest Limited, a subsidiary of Tata Sons Private Limited, acquired a controlling stake in the company. Tejas Networks received a strategic investment of ₹837.5 crore toward preferential allotment of shares and warrants. It was a win-win situation. Tata could now develop its own 5G solution and take it to the global markets. It already had the software and software-integration capabilities through TCS. Tejas would help to bring in the hardware capabilities, leverage the incentives through the PLI scheme, and also realize its 5G plans in the enterprise segment. In turn, Tejas Networks would be able to realize opportunities in India and overseas with the new cycle of investments in 5G and fiber-based broadband rollouts. The deal provides it the necessary financial resources, global relationships, and strong ecosystem to innovate and scale its business. Sanjay Nayak continues as Managing Director and Chief Executive Officer to lead Tejas Networks, along with the existing management team, through the next phase of growth.

April-September 2021. For the half year ended September 30, 2021, net revenue of Tejas Networks was ₹317 crore, which was a YoY increase of 72.1 percent, resulting in a profit-after-tax of ₹11.2 crore, as compared to a loss of ₹5.2 crore for the corresponding previous period. As on September 30, 2021, cash and cash equivalents, including investment in liquid mutual funds and deposits with financial institutions, increased to ₹1195 crore, and it continued to be a debt-free company. With healthy cash reserves, the manufacturer is in a strong position to invest for business growth.

For Q2 FY22, consolidated net revenue was ₹172.8 crore, which was a YoY increase of 61.8 percent, resulting in a profit-before-tax of ₹3.3 crore as compared to ₹4.5 crore for the corresponding previous period. Profit-after-tax was ₹s3.7 crore as compared to ₹4.5 crore for the corresponding previous period.

FY2021. Tejas Networks showed a solid turnaround in financial performance with robust year-on-year growth in revenues while returning to profitability. Performance on almost all financial parameters improved while continuing to be a zero-debt company. As a deep-technology company, investments in R&D continued and it remained focused on innovation to create globally competitive products. Since all the R&D manpower is located in India, the equipment maker gets a significant competitive cost advantage as compared to its global peers.

The company now has a globally competitive portfolio of software-defined-hardware products, and is well-positioned for building high-capacity optical backbone networks as well as high-speed broadband access networks. It has also invested in creating wireless-access products, based on the latest LTE technology, which is the base for 4G and 5G radio networks. The management is confident that being well-positioned, they will continue winning new customers and gaining market share in the existing accounts.

Being in the technology business, Tejas Networks continually invests in R&D and innovation to support the latest standards and strengthen the competitiveness of our products. During FY2021, they spent 20.6 percent of the revenues on R&D, which placed them amongst the Top-3 listed companies in India in terms of R&D spends as a percentage of revenues. The vendor continues to be a leading technology innovator in optical networking and broadband access, with 350 patent applications and a rich portfolio of 300+ semiconductor IPs.

Tejas has an end-to-end portfolio of optical products, from the core of the network to the access. The TJ1600 family of products for high-capacity metro and long-distance networks is based on cutting-edge DWDM (Dense Wavelength Division Multiplexing) and OTN (Optical Transport Network) technology and can support up to 600 Gbps per wavelength. TJ1400 product is a unique converged platform for high-speed broadband access that uses GPON (Gigabit Passive Optical Network) technology for optical fiber-based services for residential and business customers, as well as LTE technology for Fixed Wireless Access (FWA) services. In addition, it has a rich set of Packet Transport Network (PTN) products and Ethernet switches for critical infrastructure buildouts.

Tejas Networks ended the financial year 2020-21 with strong revenue as well as profitability growth. Net revenue was ₹514.8 crore (net of pass through component sale), which was a YoY increase of 35.6 percent, with a profit-before-tax of ₹22.5 crore as compared to a loss-before-tax and before-impairment-of-intangibles was ₹68.7 crore for the corresponding previous period. Profit-after-tax was ₹s37.5 crore as compared to a loss-after-tax and before-impairment-of-intangible-assets of ₹167.3 crore for the corresponding previous period.

The international business during the year saw a robust YoY revenue growth of 62 percent and was 40 percent of our total revenue (up from 33 percent during FY20), led by customers in Africa, Mid-East, and South-East Asia. The business in India saw positive tailwinds due to increased demand for highspeed broadband connections and government policy for promoting domestic telecom equipment. The company saw strong order inflows as well as new customer wins, resulting in a YoY booking growth of 54 percent and ended FY21 with an order book of ₹679 crore.

With its products being deployed in over 75 countries, there is great opportunity to become a trusted and reliable global source for leading-edge, yet cost-competitive telecom products.

During FY2021, India business grew healthily across both government and private segments. We are well established as one of the leading suppliers of optical networking and broadband-access equipment to private telcos as well as government networks.

“We are enthused by the Honourable Prime Minister of India’s call to build an Atmanirbhar Bharat (self-reliant India) in critical areas of technologies, such as telecom, which has long-term security as well as economic significance. We see a strong intent from the government to promote products developed with Indian R&D and IPR, and which are manufactured in India. We believe that supportive government policies, such as the product linked incentive (PLI) scheme, the mandate for all telecom service providers (both government and private) to source only trusted telecom equipment, and further strengthening of Preference to Make in India (PMI) policy, clearly signals that the government wants to make India a global telecom equipment manufacturing hub, especially in light of the new geopolitical situation.

We have the right product mix at competitive price points; great R&D team, which continues to develop leading-edge technologies; highly favorable geopolitical situation, where countries are seeking trusted telecom products; increased digital adoption, driving increasing investments in network capacities, and more importantly, favorable Indian government policies and intent. All these combined together set a great platform for our future growth,” observed Balakrishnan V, Chairman, Board of Directors, Tejas Networks.