Tata Communications Limited disclosed a 29% decline in net profit for the first quarter of the fiscal year 2027, with revenue from operations increasing by 10% to Rs 6,583 crore from Rs 5,960 crore in the previous year. The company attributed a one-time cost of Rs 106 crore in the quarter to actuarial provisions following a change in the legal definition of “wages” under India’s labor codes in November 2025. Tata Communications had initially set aside Rs 60.58 crore for gratuity and long-term compensated absences for the previous fiscal year, but revised this provision by Rs 18.52 crore in the June quarter based on updated actuarial estimates.
The firm’s total expenses surged by 10.82% to Rs 6,278 crore year-on-year. Operationally, the company’s earnings before interest, tax, depreciation, and amortization (EBITDA) reached Rs 1,230 crore for the quarter, marking an 8.21% increase from the previous year. Tata Communications reported an EBITDA margin of 18.7% in Q1 FY27, slightly lower than the 19% recorded in the same period of FY26.
In the April-June quarter of the fiscal year 2027, the company’s digital portfolio revenue witnessed a growth of 17.1% to Rs 2,940 crore, compared to Rs 2,510 crore in the June quarter of FY26. Ganesh Lakshminarayanan, MD and CEO of Tata Communications, expressed satisfaction with the strong start to the year, emphasizing robust growth in both core and digital portfolios. He affirmed the company’s commitment to achieving double-digit EBITDA growth for the year, highlighting the focus on enhancing network fabric business, expanding platform revenues, improving digital profitability, and strengthening EBITDA-to-cash conversion.
Following the financial results, Tata Communications shares closed 1.1% lower at Rs 1,798 apiece, having dipped nearly 6% earlier in the session.
