Tejas Networks Limited is majority owned by Tata Sons Pvt Ltd, which holds approximately 53.91% of the company’s shares as of June 2025. This makes Tejas Networks a part of the Tata Group, one of India’s largest and most prominent conglomerates. The remaining shares are held by institutional investors, mutual funds, foreign investors, and individual shareholders.
SWOT Analysis of Tejas Networks Ltd (as of mid-2025)
| Strengths | Weaknesses |
|---|---|
| Market Leadership in India: Holds about 25% market share in India’s optical networking space, serving over 300 customers, including major telecom operators. Recognized as India’s largest telecom equipment manufacturer with strong brand recognition. | Client Concentration Risk: Around 60% of revenue comes from the top three clients, creating significant dependence and vulnerability to contract changes. |
| Strong R&D Capabilities: Invests approximately 12% of annual revenue (about ₹139 crore in FY2023) in R&D, enabling innovation in 5G and advanced telecom technologies. | Limited Global Presence: Less than 20% of revenue comes from international markets, indicating over-reliance on the Indian market and limiting global growth. |
| Strategic Partnerships: Collaborations with global technology leaders like Intel, Cisco, Rakuten Symphony, and NEC Japan enhance technological capabilities and market reach. | Dependence on Government Contracts: About 50% of revenue is from government projects, exposing the company to risks from policy changes and bureaucratic delays. |
| Policy Support: Benefits from Indian government initiatives such as Atmanirbhar Bharat and PLI schemes, as well as large public sector investments (e.g., BSNL upgrades). | Inventory & Working Capital Issues: Recent sharp increase in inventory (from ₹494 crore to ₹2,683 crore in one year) and large write-downs have hurt profitability and raised concerns about demand forecasting and working capital management. |
| Comprehensive Product Portfolio: Offers a wide range of optical networking, broadband access, and integrated networking products, with a total addressable market of about ₹5,000 crore. | Supply Chain Vulnerabilities: Has faced delays due to component shortages, particularly during global semiconductor supply constraints, affecting timely deliveries. |
| Opportunities | Threats |
|---|---|
| 5G Infrastructure Rollout: The global 5G infrastructure market is projected to reach $47.2 billion by 2025. Tejas is well-positioned to benefit with its advanced solutions. | Foreign Exchange Risks: As the company increases its international exposure, it faces currency fluctuation risks, impacting profitability. |
| BharatNet Phase 3: Expected orders worth ₹3,000–4,000 crore from this national broadband project, which involves a ₹65,000 crore investment. | Operational & Supply Chain Risks: Ongoing global semiconductor shortages and supply chain disruptions can delay product rollouts and impact financial performance. |
| Kavach Railway Safety System: Anticipated ₹2,000–3,000 crore orders from this large-scale railway safety initiative. | Credit Risk Management: Dependence on large government contracts and a few key clients increases exposure to payment delays and credit risks. |
| Digital India & Enterprise Transformation: India’s Digital India initiative and the global shift towards digital transformation offer significant growth avenues. | Market Volatility & Institutional Selling: High stock volatility (beta ~1.8–1.94) and recent institutional stake reductions have increased market uncertainty and share price pressure. |
| Global Shift from Chinese Vendors: Many countries are seeking alternatives to Chinese telecom equipment, creating export opportunities for Tejas. | Order Book Decline: The order book has dropped sharply from ₹4,845 crore to ₹1,019 crore in FY25, raising concerns about future revenue visibility. |
Recent Developments & Context (2025):
- The stock price has declined over 50% from its 52-week high due to deteriorating financial performance, particularly a net loss in Q4 FY25 driven by heavy inventory provisions and asset write-offs.
- The order book has contracted significantly, and institutional investors have reduced their holdings, contributing to negative sentiment and high volatility.
- Despite these challenges, Tejas Networks retains strong domestic positioning and is actively pursuing opportunities in 5G, national broadband, and railway safety projects, while seeking to expand its global footprint and diversify its client base.