Tata Communications misses Q1 estimates; brokerages retain Buy and revise targets

Tata Communications reported Q1 FY27 revenue of ₹6,580 crore, up 10.5% year on year, while growth in cloud, cybersecurity and media trailed expectations. JM Financial cut its target price to ₹2,260, while Nuvama raised its target to ₹2,300; both retained Buy ratings.

— Source publishedThu, 23 Jul, 2026, 10:03 IST·First seen Thu, 23 Jul, 2026, 10:19 IST·Source Business Today · Latest

What happened

Tata Communications missed some Q1 FY27 revenue and EBITDA expectations as cloud, cybersecurity and media growth lagged. JM Financial cut its target to Rs

Key facts

  • Consolidated revenue: Rs 6,580 crore, up 10.5% YoY
  • Data segment revenue: Rs 5,710 crore
  • Digital portfolio revenue: Rs 2,940 crore
  • Reported EBITDA: Rs 1,230 crore, up 8.2% YoY
  • Normalised EBITDA: Rs 1,280 crore, up 12.7% YoY
  • Normalised EBITDA margin: 19.4%
  • Net debt: Rs 10,400 crore
  • Capex: Rs 660 crore, 10% of revenue
  • JM Financial target price: Rs 2,260, reduced from Rs 2,295
  • Nuvama target price: Rs 2,300, raised from Rs 2,000
  • Share price: Rs 1,770.70, up 0.57%

Why this matters

The softness in cloud, cybersecurity and media highlights a need to strengthen capabilities, partnerships or targeted acquisitions in these strategic digital-services segments.

What to watch

  • Sequential growth and bookings in cloud, cybersecurity and media services in the next two quarters.
  • EBITDA margin trend, especially whether investment costs outpace revenue mix benefits.
  • Large enterprise deal wins, renewal rates and contract ramp-up timelines.
  • Management commentary on FY27 guidance, demand softness and digital-services pipeline conversion.
  • Further broker earnings-estimate revisions and target-price changes around subsequent results.
  • Increase sales focus on bundled managed network, cloud and cybersecurity contracts to raise wallet share from existing enterprise customers.
  • Prioritize large-deal conversion and disclose order-book, bookings and pipeline metrics to rebuild confidence in digital growth.
  • Tighten investment pacing in cloud, media and cybersecurity platforms if revenue conversion remains below plan.
  • Use partnerships and cross-selling with hyperscalers, security vendors and media customers to accelerate service adoption without materially increasing fixed costs.