Corporate

Tata Communications Q2 profit surges seven-fold

Tata Communications, Kacific ink global IP connectivity, and cybersecurity deal

Tata Communications posted an around seven-fold jump in consolidated net profit at Rs 384.81 crore for the September quarter. The company had registered a profit of Rs 54.31 crore in the corresponding period of the preceding fiscal.

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Consolidated revenue grew 4.5 percent to Rs 4,477.18 crore during the reported quarter from Rs 4,282.3 crore in the year-ago period, it said in a BSE filing. Besides, the company concluded the sale of a land parcel along with building for a total consideration of Rs 67.41 crore.

Also Read: HCL Technologies posts 18.5 pc surge in net profit for Q2

The company during the quarter received a demand note from the Department of Telecommunications (DoT) to pay Rs 6,633.43 crore towards licence fees on its adjusted gross revenue (AGR) for the financial years 2006-07 till 2017-18, it added. “The demands received by the company included an amount of Rs 543370 lakhs which were disallowed by the DoT towards the cost adjusted to gross revenue by the company that were claimed on ‘accrual basis’ instead of payments basis, for which revised statements on the basis of actual payment has been submitted to the DoT,” Tata Communications said.

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The Supreme Court had last year upheld a government formula to calculate revenue share with telecom service providers. It has ordered companies to clear their dues in 10 yearly instalments starting next fiscal and 10 percent of total dues as demanded by the DoT by March 31, 2020. Tata Communications said though the company believes that it has a case to defend its point, but still it made a provision of Rs 337.17 crore during the January-March quarter.

Also Read: Infosys reports 14.4 pc growth for September quarter

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