Tata Communications Aims To Achieve 23-25% Ebitda Margin By FY28: CFO

Tata Communications Ltd. aims to achieve an earnings before interest, taxes, depreciation and amortization (Ebitda) margin of 23% to 25% by FY28. The network and communication technology solutions provider earlier aimed to achieve this target by FY27.

However, it has been delayed by a few quarters, according to the company’s CFO, Kabir Ahmed Shakir.

“We gave a very clear picture to the street, by FY27, we wanted to get to 20% to 25%; that's out by a few quarters, four or five. We have given an ambition that we are looking at FY28 to get back into a particular range,” he said during a conversation with NDTV Profit.

The CFO confirmed that the timeline for achieving revenue of Rs 28,000 crore by FY27 could be deferred as well.

“Five years ago, this company was growing at a low to mid-single-digit rate. But now, we've consistently delivered double-digit growth over several quarters. It is only a matter of time before our digital portfolio starts contributing growth in the range of 25–30%. At that point, we’ll be on track to double our business,” he said.

However, he called these targets “ambitions” rather than formal guidance, citing the volatile global economic environment.

“I hate to give guidance because we are in such a volatile business scenario. I mean, interest rate environment, tariffs, geopolitical crisis, it's very difficult to pinpoint one number and not have the elbow room to navigate your business,” the top executive noted.

Commenting on Q1FY26 results, the CFO highlighted the 9.4%year-on-year (YoY) growth in its data business. He emphasised that this was a clean, like-for-like comparison with no acquisition benefits boosting the numbers.  

"Yes, we would have wanted it to be in double digits, but I'm quite happy with 9.4%," he said.

The company’s Ebitda margin was 19.1% in Q1FY26, compared to 20.3% in Q1FY25. Profit after tax declined 34.9% YoY to Rs 232 crore in Q1FY26 from Rs 357 crore in Q1FY25.

On the operational front, the company witnessed a strong start to the financial year, signing a "very healthy" order book in the first quarter. While the financial impact of these deals will materialise from Q3 onwards, it signals a strong pipeline, according to the CFO.

Shakir acknowledged that closing large deals remains a lengthy process, but some deals that had previously been rolled over have now been closed.

Shares of Tata Communications were trading 1.87% higher at Rs 1,764 apiece on the NSE at 1:37 p.m., while the benchmark Nifty50 stood at 24,956.15, down 0.62%.