In this week, Tejas Networks is planning an Initial Public Offer (IPO) on June 14-16, 2017 and the price band fixed per equity share varies from Rs. 250-275. The money from IPO will be used for innovation, newer products and newer markets.
The IPO open on June 14, 2017 for cash comprising of a fresh issue of equity shares aggregating up to Rs. 450 crores and an offer for sale of up to 12,711,605 equity shares by selling shareholders. Bids can be made for a minimum of 55 equity shares and in multiples of 55 equity shares thereafter.
Tejas was formed in April 4, 2000 and is ranked amongst Top 10 suppliers in the global optical aggregation segment. The company designs, develops and sells high-performance and cost-competitive products to telecommunications service providers, internet service providers, utility companies, defence companies and government entities in over 60 countries. Tejas products utilize a programmable software-defined hardware architecture with a common software code-base that delivers an app-like ease of development and upgrades of new features and technology standards.
The company has filed over 300 patents and it looks R&D is part of its DNA. The company holds 39 international patents of which 6 is granted in Europe and 33 granted in the United States. 54 patents are pending in the United States. In India, the company has got 8 patents whereas 190 patent applications are still pending.
As on September 30, 2016, the company has around 592 employees of which 314 employees are in R&D activities i.e. 53 per cent employees in R&D. In terms of R&D investment, the company has invested around Rs. 64.4 crore in FY2016 and Rs. 49 crore in FY2015. For six months of FY2017, the company has invested Rs. 32.7 crore.
Tejas Networks: Financials
Parameter – FY2015 – FY2016 – FY2017 (till Sept)
Revenue – Rs. 386.8 Cr – Rs 627.5 Cr – Rs. 350.8 Cr
Profit – Rs. (17.9) Cr – Rs. 29 Cr – Rs. 16.5 Cr
Source: Tejas Networks
In FY 2016, the Top 5 customers i.e. Bharti Airtel, BSNL, Ciena, Sacofa and Tata Communications which contribute around 67.4% of consolidated net revenue. In 6 months of FY2017, the Top 5 customers i.e. Ciena, L&T, Powergrid, RailTel and Tata Communications which contribute around 56% of consolidated net revenue. The company manufactures its products through EMS partners Sanmina, Rangsons Electronics which was acquired by Cyient. Sanmina has a factory in Chennai whereas Cyient has a factory in Mysore.
The company is planning to expand its global sales network in emerging and selected developed markets like SAARC, South-East Asia, Africa and Central America. Tejas Networks will also continue to invest in sales efforts to increase its market share in the expanding Indian market both in service provider and government projects like: Smart City, NOFN, NFS, NKN, Digital India and Make in India.
The company is also planning to expand existing OEM relationship with Ciena, NEC and RAD Data Communications and also with new OEMs.
The company’s strategy is to focus on continued investments in innovations focused on optical networking. The company’s expect high growth in optical transport network (OTN), Converged Packet Optical (CPO) and Reconfigurable Optical Add Drop Multiplexer (ROADM). Tejas is planning to expand into newer and adjacent product areas. The company is currently investing in new products in wireless access product on 4G to provide fixed wireless services to enterprises, residential customers and mobile backhaul. Focus is also on next-generation PON and L2/L3 Ethernet Switches.