Tata Communications - Clarity On Growth Path Ahead: ICICI Direct
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ICICI Direct Report
Tata Communications Ltd. in its investor day revisited (and revised some of) its strategic growth path.
The core growth path remained same with steps like deeper engagement with key clients (along with dedicated team for remaining clients), revamped operating structure, transformation from product to platform and focus on fixed plus usage model for digital platforms.
On the medium-term financial targets, there were few upgrades with:
Return on capital employed target of 25-30% (versus 20% target earlier).
Ebitda margin of 23-25% (earlier guidance: 22-25%).
Maintaining optimal debt (versus debt reduction guidance earlier).
Double digit data revenues target (same as before) with incremental margin buffer/cash being reinvested to drive growth.
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