What started as a landmark year for Tejas Networks Ltd has swiftly turned into a financial quagmire. The Tata group-backed telecom equipment manufacturer, which embarked on a major 4G network rollout for state-owned Bharat Sanchar Nigam Ltd (BSNL) across 100,000 sites in 2024-25, is now grappling with extended quarterly losses. The primary culprit is a critical delay in a follow-up order from BSNL, which has severely constrained revenue and led to mounting inventory.
The Stalled Order and Mounting Inventory Pressure
For close to a year, the Bengaluru-based company has been awaiting a final purchase order from BSNL for an "add-on" project worth ₹1,526 crore. This order involves supplying, deploying, and maintaining 4G mobile networks at an additional 18,685 sites. While an advanced purchase order (APO) was received via partner Tata Consultancy Services Ltd (TCS) in May 2025, the final go-ahead remains pending.
This delay has forced Tejas Networks to hold onto specialized inventory procured for this project. Consequently, the firm's inventory levels have stubbornly remained above ₹2,300 crore for four quarters in a row. Executive Director and COO Arnob Roy explained during the 9 January earnings call that the inventory was pre-emptively acquired to ensure swift execution once the BSNL order materializes. He attributed the holdup to BSNL's operational readiness for the network rollout.
Financial Fallout and Investor Concerns
The operational bottleneck has directly hit the company's bottom line. For the December quarter, Tejas Networks reported a net loss of ₹197 crore, a stark reversal from the ₹166 crore profit recorded a year earlier. Revenue from operations plummeted by over 88% year-on-year to just ₹307 crore. The cumulative loss for the first nine months of the fiscal year stands at a staggering ₹698 crore, compared to a profit of ₹518 crore in the same period last year.
During the earnings call, investors and analysts expressed growing impatience, raising red flags over the company's financial model. A major concern is that the inventory level is now double the size of the order book, which stands at ₹1,329 crore. This mismatch creates an excessively long working capital cycle, eroding shareholder returns. Questions also mounted about the company's cash runway, given recurring EBITDA losses of around ₹150 crore and the significant revenue needed to break even independent of BSNL orders.
The market reaction was severe. The company's shares fell 8.9% to close at ₹380 on the NSE following the results. Data shows the stock has plunged 61.7% in 2025, from ₹1,185.7.
Leadership Vacuum and Future Strategy
Adding to the challenges is a leadership gap. The position of Chief Executive Officer has been vacant for about three quarters since the resignation of former CEO Anand Athreya. Roy assured stakeholders that daily operations are unaffected and the board is actively working on an appointment.
Looking beyond the current crisis with BSNL, Tejas Networks is betting on diversification. Roy emphasized that BSNL projects are a platform, not a lifeline. The company's strategy is to expand globally and with private telecom operators. It has already secured a three-year contract with Vodafone Idea Ltd in December 2024 for backhaul capacity products.
Currently, India constitutes 92% of its ₹1,329 crore order book, with international business making up the remaining 8%. The company reports increasing international engagement for its 4G/5G RAN equipment, with proofs-of-concept and commercial talks underway in Asia Pacific, Latin America, Africa, and Europe.
Analysts, however, urge caution. Faisal Kawoosa, Chief Analyst at Techarc, pointed out Tejas Networks' heavy reliance on a single customer (BSNL) and the fact that major private Indian telcos do not use its gear. He advised a stronger focus on R&D to drive innovation and compete with global players, especially Chinese manufacturers, in the international market.
Roy remains optimistic, stating the path to profitability will be paved as the business scales up internationally and in India, driven by both wireless and wireline products. The company anticipates future demand from AI-driven traffic growth, continued 4G expansion, new 5G deployments in emerging markets, and investments in AI data centers.
