Emkay Global Financial recommends buying Tejas Networks, citing a strong order book, improving revenue outlook, and expanding product portfolio, with a target price of Rs 1100.
Tejas Networks has been a consistent performer in the Indian telecommunications sector, and its recent price action suggests that it is undervalued. The company’s strong order book, ‘We believe that Tejas Networks’ strong order book is a key driver of its growth prospects.’ , improving revenue outlook, and expanding product portfolio are key factors that support our buy recommendation.
Tejas Networks is an Indian multinational networking equipment company that designs and manufactures broadband network products.
Founded in 2000, the company offers a range of solutions including routers, switches, and optical transport systems.
Tejas Networks' products are used by several telecom operators worldwide, particularly in Asia and Africa.
The company's technology focuses on providing high-speed data transfer capabilities for mobile backhaul, metro networks, and long-haul transmission.
Key Drivers
The key drivers behind Tejas Networks‘ growth prospects include:
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Strong Order Book: The company has a robust order book with a significant backlog of orders from both domestic and international customers. This indicates strong demand for its products and services.
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Improving Revenue Outlook: Tejas Networks is expected to benefit from the increasing adoption of 5G technology in India, which will drive growth in its revenue.
- Expanding Product Portfolio: The company has been expanding its product portfolio through acquisitions and organic growth, which will help it to cater to a wider range of customers and applications.
Companies can improve their revenue outlook by diversifying products or services, expanding into new markets, and investing in digital transformation.
According to a study, businesses that adopt cloud computing see an average increase of 25% in revenue.
Additionally, focusing on customer experience through personalized marketing and improved customer service can lead to increased loyalty and retention rates.
Data-driven decision-making is also crucial, with 70% of companies using data analytics to inform their business strategies.
Valuation
Our target price for Tejas Networks is Rs 1100, which represents a significant upside from current levels. The company’s valuation multiple is reasonable compared to its peers, and we expect the stock to outperform in the long term.
Recommendation
We recommend buying Tejas Networks at current levels and targeting Rs 1100. The company’s strong growth prospects, improving revenue outlook, and expanding product portfolio make it an attractive investment opportunity.
- moneycontrol.com | Buy Tejas Networks; target of Rs 1100: Emkay Global Financial
