Motilal Oswal Financial Services has provided a neutral rating on Tata Communications with a target price of Rs 1550.
The company recently reported its Q2FY22 results, where its consolidated profit surged by 58% YoY.
The increase was attributed to the strong overall performance across segments, including data, voice, and digital services.
Despite the positive results, the stock seems fully valued at current levels, hence suggesting a neutral view.
Tata Communications has witnessed growth in major segments, such as voice, data, and digital services.
The company's enterprise business has also performed well, aided by strong demand for cloud and security services.
However, challenges persist, especially in the data business, due to increasing competitive intensity and pricing pressure.
Furthermore, the European business, as well as data center partnerships, continue to be significant areas of concern.
With the evolving business landscape and potential regulatory changes, the company's ability to adjust and adapt will be crucial.
In conclusion, Motilal Oswal Financial Services has given a neutral outlook on Tata Communications, emphasizing that while the company has exhibited strong performance and growth across various segments, challenges and uncertainties persist.