Tata Communications stock slips on muted Q4 earnings

Shares of telecom services provider Tata Communications Ltd fell more than 2% in Thursday’s opening trade on the NSE, reacting to its muted March quarter earnings. Operating margins and revenue growth both missed expectations.

Revenue, at Rs470 crore, was down 3.5% sequentially and below analysts estimates impacted by decline in voice and data business. The former was down 17% quarter-on-quarter and the latter fell by a percent sequentially. Analysts attribute the decline in data revenue to longer deal conversion and execution cycle due to covid-19 and the moderation of UCC (unsolicited commercial communication) traffic. According to analysts at Motilal Oswal Financial Services Ltd, the decline in Ebitda margins of the data segment, which forms a chunk of the overall Ebitda,