Tejas Networks’ record pivots on a single-customer project that has now ended: revenue collapsed 88% in FY26, operating cash flow has been structurally negative across the cycle, and the company reports a net-cash position while carrying ₹4,177 crore of borrowings. The audit opinions are unqualified, and the company discloses its risks, but the disclosures themselves are the story.
Key findings
- Revenue collapsed 88% after a single customer drove FY25 to a peak
Major- Consolidated revenue fell from ₹8,923 crore in FY25 to ₹1,103 crore in FY26 as the BSNL 4G project supply concluded and new awards were delayed. One customer, Tata Consultancy Services, contributed ₹7,329 crore, 82% of consolidated revenue, in FY25, up from ₹756 crore in FY24. Trade receivables stood at ₹3,256 crore at FY26 with the Days Sales Outstanding ratio rising 493% year-on-year, though the company states no receivables are credit-impaired. - RPT revenue from TCS fell 99.6% while the company sought a fresh ₹4,800 crore limit
Major- Revenue from TCS dropped to ₹28.29 crore in FY26 from ₹7,329 crore in FY25. In June 2026 the company sought shareholder approval for material RPTs with TCS up to ₹4,800 crore for FY27. It also sought a ₹460 crore limit with Tata Semiconductor Assembly and Test Private Limited, which reported a net loss of ₹153.68 crore and negative net worth of ₹118.13 crore in FY25. - Cumulative CFO is ₹-2,330 crore against EBITDA of ₹1,259 crore over six years
Major- Cumulative consolidated CFO from FY21 through FY26 was ₹-2,330 crore against cumulative EBITDA of ₹1,259 crore, a CFO/EBITDA ratio of -1.85x. Free cash flow was negative in each of the last four years, and the Board paid a dividend of ₹44.15 crore for FY25 in a year when free cash flow was also negative. Consolidated CWIP stood at ₹950 crore as of FY26, representing 227% of net PP&E of ₹419 crore. - Deferred-tax assets of ₹365 crore rest on revenue forecasts that have been wrong for three years
Major- Net deferred-tax asset carrying value stood at ₹365.24 crore as at March 31, 2026. In FY2020 the Company reduced its deferred-tax asset by ₹98.55 crore because sufficient future taxable profits were no longer probable. Separately, the Saankhya Labs amalgamation generated a capital reserve of ₹143.57 crore and reversed a financial liability of ₹169.23 crore straight to retained earnings, routing material amounts around the income statement. - The company reports a net-cash position while carrying ₹4,177 crore of borrowings
Minor- Consolidated borrowings stood at ₹4,177 crore as at March 31, 2026, yet the net-debt reconciliation claims a net-cash position of ₹(1,625.56) crore by deducting cash, bank balances, margin-money deposits, and current investments from gross debt. - Tax disputes exceed ₹90 crore with no provisions, and a prosecution notice is pending
Minor- Central Excise demands of ₹42.92 crore and ₹3.32 crore remain contested before the Supreme Court and CESTAT respectively, with no provision made. A Customs demand of ₹33.42 crore was received in January 2025 and a writ petition obtained an interim stay from the Karnataka High Court. The Income Tax Department issued a show-cause notice under Section 276C (prosecution) in March 2018, and the Company and its officers have appealed in the Karnataka High Court. - Audit opinions are unqualified, but a persistent audit-trail gap and unaudited subsidiaries add opacity
Minor- The standalone and consolidated audit opinions were unqualified every year from FY2020 through FY2026. In FY2024 the accounting software’s audit-trail feature operated only from March 27 to 31, and for direct database changes the pre-modified value was not recorded. Unaudited management-certified subsidiaries were present in five of the seven years, with total assets of ₹20.15 crore across three subsidiaries in FY26.
What to watch
- TCS and TSAT RPT limits. Whether the ₹4,800 crore TCS limit and ₹460 crore TSAT limit approved at the 26th AGM on 26 June 2026 translate into actual revenue in FY27, given FY26 TCS revenue was only ₹28.29 crore against a prior-year limit of ₹5,000 crore.
- Order backlog and TCS advance. Recognition of the ₹1,514 crore order backlog as of March 31, 2026, with \~50% expected within one year, and conversion of the ₹1,335 crore TCS advance against receivables.
- Goodwill and IAUD impairment. Impairment testing for goodwill of ₹211.81 crore and IAUD of ₹950.43 crore at the next reporting date, given the FY26 consolidated net loss of ₹909 crore and negative ROCE of -14.8%.
- Customs demand outcome. Outcome of the writ petition before the Karnataka High Court on the Customs demand of ₹33.42 crore received in January 2025.
- Excise duty appeal. Outcome of the Supreme Court appeal against the CESTAT order dated 12 June 2018 on the ₹42.92 crore excise duty demand.
Bottom line: This is a disclosed and audited record whose shape was set by one contract. The contract has ended, and the financials now show what remains: a ₹909 crore net loss, structurally negative cash flow, and large intangible carrying values that depend on a recovery the forecasts have not yet delivered. The related-party limits voted in June 2026 signal intent, but the gap between intent and booked revenue is the entire FY26 story. Watch the backlog conversion, the impairment tests, and whether the TCS limits turn into actual orders.