Tata Teleservices (Maharashtra) Ltd Management Discussions

Telecom Industry Developments India Economic Outlook

India demonstrated strong economic resilience in FY25. The primary growth drivers included government investment in infrastructure and sustained domestic demand for goods and services. Due to ongoing conflicts and global tensions, Indias GDP growth rate for the financial year 2024-25 is projected to be approximately 6.5%, compared to 8.2% in the previous year. In contrast, global growth is expected to average around 3.2% over the next five years. Currency depreciation in the last 2 quarters has created a ripple effect throughout the economy, adversely affecting trade volumes across various sectors.

The Indian economy is projected to grow by approximately 6.3-6.8% in the financial year 2025-2026, driven by moderating inflationary pressures and continued momentum in the manufacturing and service sectors. However, there remains uncertainty because of global conflicts and the resulting impact from the trade tariffs of the new US administration.

Indian Telecom Industry Developments Telecom Industry

The Government of India is actively supporting the telecom industry through various initiatives and policies aimed at fostering growth, innovation, and digital inclusion. Indias Atmanirbhar Bharat initiative aims to transform the nation into a global leader in telecom equipment development and manufacturing. The Department of Telecommunications ("DoT") is actively supporting this vision by:

• Fostering an R&D ecosystem: This includes encouraging research in areas like core transmission equipment, next generation 4G/5G infrastructure, and various types of user equipment (wireless, access, CPE, IoT devices, etc.).

• Bharat 6G Vision: With the goal of developing indigenous 6G solutions, DoT has launched the 6G Technology Innovation Group (6G-TIG). This initiative brings together academic institutions, industry players, and government bodies to drive research and development in this next-generation technology. As of October 2024, India had 200 6G patents and aims to secure 10% of all 6G patents over the next 3 years.

Digital initiatives have played a crucial role in sustainable development, unlocking innovation and improving public service delivery. AI-enabled health and education tools, along with digital public infrastructure, have enhanced the quality of life and accessibility of services. The Digital initiatives are aimed at transforming the country into a digitally empowered society and knowledge economy.

1. Digital India Initiative: Launched in 2015, the Digital India initiative aims to transform India into a digitally empowered society and knowledge economy. It includes various programmes to promote digital infrastructure, digital literacy, and digital delivery of services. The initiative has led to the creation of digital platforms for government services, such as the UMANG app, DigiLocker, and the e-Hospital system.

2. BharatNet Project: This project aims to provide high-speed broadband connectivity to rural areas across India. It is one of the worlds largest rural broadband projects, aiming to connect all 250,000 Gram Panchayats in the country. The project is being implemented in phases, with significant progress made in laying optical fiber cables and providing internet access to rural communities.

3. Production Linked Incentive (PLI) Scheme: The PLI

scheme for telecom and networking products aims to boost domestic manufacturing and reduce dependence on imports. The scheme provides financial incentives to companies for manufacturing telecom equipment, including 5G gear, in India. This initiative is expected to attract significant investments and create job opportunities in the telecom sector.

4. Telecom Technology Development Fund (TTDF) Scheme:

This scheme aims to promote research and development in telecom technologies, particularly those relevant to rural and remote areas. The fund supports projects that focus on developing innovative solutions to improve telecom infrastructure and services in underserved regions.

5. IndiaAI Mission: Launched in 2024, the IndiaAI Mission aims to enhance the countrys AI capabilities by promoting research, innovation, and the development of AI-based solutions. The mission includes initiatives to build AI infrastructure, support AI startups, and foster collaboration between academia, industry, and government.

6. Centre of Excellence in AI for Education: This initiative aims to establish a Centre of Excellence in AI within the education sector. The centre will focus on promoting AI education and research, equipping students with the skills needed to thrive in a technology-driven economy.

These initiatives reflect the governments commitment to transforming Indias digital landscape and positioning it as a global leader in digital connectivity and innovation.

As Indias digital landscape evolves rapidly, organizations are actively adapting to this transformation by rethinking their business models, strategies, and product offerings. To stay agile in such a fast-paced environment, they are constantly developing new digital solutions. These solutions incorporate advanced technologies like Data Analytics, Cloud Computing, Artificial Intelligence (AI), Machine Learning (ML), Cybersecurity, and Automation, which drive digital transformation across multiple functions, including marketing, sales, finance, and more.

Overall Market View

The enterprise telecom market in India is defined by rapid digital transformation, new use cases evolving with digital technologies, especially in the space of AI, an increased emphasize on security and compliance, rising adoption of Cloud and Managed Services, demand for unified communication solutions, industry-specific requirements, and government-driven digital initiatives.

Large enterprises and SMEs both are driving digital transformation and leveraging telecom services to fuel their growth. Their specific needs, preferences, and adoption patterns vary based on their size, resources, and strategic priorities.

Digital transformation involves a comprehensive integration of digital technology into all areas of a business, fundamentally changing how they operate and deliver value to customers. It encompasses far-reaching strategies that involve not just technological changes but also shifts in organizational culture, processes, and customer engagement methods.

One significant aspect of digital transformation is the adoption of new and emerging technologies. Businesses are increasingly utilizing advanced technologies like Data Analytics, Cloud Computing, Artificial Intelligence (AI), Machine Learning (ML), Cybersecurity, and Automation. These technologies collectively enhance efficiency, reduce operational costs, and open new opportunities for innovation.

AI and ML play a critical role in this transformation. AI-powered systems and applications can analyse vast amounts of data to uncover patterns, make predictions, and provide insights that were previously unattainable. This leads to more informed decision-making, personalized customer experiences, and optimized business processes. Machine learning, a subset of AI, further enhances these capabilities by enabling systems to learn from data and improve their performance over time without explicit programming.

As AI and ML continue to evolve, their applications will expand, driving further waves of innovation and efficiency across industries. Businesses that embrace these technologies will be better positioned to navigate the competitive landscape, meet changing customer expectations, and achieve sustainable growth.

Future Outlook

The Information and Communication Technology (ICT) landscape in India is evolving rapidly, presenting both opportunities and challenges for enterprises, especially Small and Medium Enterprises (SMEs). As the backbone of the Indian economy, SMEs are increasingly leveraging ICT to enhance their competitiveness, efficiency, and innovation capacity:

• The market for enterprise data services is experiencing steady growth, driven by the rise of hybrid IT infrastructures and the increasing adoption of multi-cloud environments, reflecting the changing needs of modern enterprises. This growth is fueled by the necessity for businesses to manage vast amounts of data efficiently and securely across various platforms. Enterprises are increasingly seeking flexible solutions that allow seamless integration, scalability, and improved performance, thereby ensuring they remain competitive in an ever-evolving digital landscape.

• Internet Leased Line & Point-to-Point Connectivity: The strong demand from key sectors such as IT, BFSI, Media, and Services is anticipated to drive continuous growth. This highlights the essential role of Internet Leased Lines and Point-to-Point connectivity in supporting critical business operations within an ever-evolving digital environment.

• SD-WAN: Organizations across multiple industries are adopting SD-WAN solutions to simplify network management, enhance operational efficiency, and reduce costs, in line with their broader WAN transformation strategies. By leveraging SD-WAN technology, companies can gain better control over their network traffic, ensure higher levels of performance and reliability, and easily scale their networks to meet growing demands. This adoption is crucial for enterprises aiming to stay competitive and agile in todays fast-paced digital landscape.

• Broadband Internet Services: High-speed broadband internet is the backbone of digital transformation for SMEs. Reliable and fast internet connectivity ensures smooth operations, from cloud-based applications to seamless communication. Fiber optic broadband services are increasingly favoured for their superior speed and reliability compared to traditional DSL or cable connections. SMEs leverage fiber broadband to access high-speed internet that supports real-time interactions, large data transfers, and uninterrupted online services.

• SIP Trunking: Enterprises are increasingly adopting IP-based SIP Trunking due to its advanced security features, scalable adaptability, and cost-effectiveness, making it a superior alternative to traditional telephone lines.

• Unified Communications and Cloud Communications:

Enterprises are adopting integrated solutions that offer increased business agility, seamless connectivity from any location, enhanced collaboration capabilities, and improved customer interactions, all while reducing operational expenses. These solutions combine various communication services such as voice, video, messaging, and conferencing into a single platform, enabling employees to communicate and collaborate effectively regardless of their physical location.

• Security services such as Zero Trust architecture and endpoint security are becoming critical due to remote work and BYOD policies, which require protection from malware and ransomware. Zero Trust architecture ensures that no device or user is trusted by default, even if they are within the network perimeter. Endpoint security involves securing individual devices such as laptops, mobiles, and tablets against threats. Additionally, the shift to cloud computing increases the demand for Cloud Security Services to ensure visibility, control, and compliance across multi-cloud environments. Cloud Security Services help organizations monitor access to their cloud resources, manage data privacy, and adhere to regulatory standards, providing a comprehensive approach to safeguarding digital assets in increasingly complex IT infrastructures.

• Advanced Business Communications and Marketing Solutions: The focus on omni-channel customer engagement, improving customer experiences, and building customer loyalty is expected to drive the omni-channel platforms and solutions market. These platforms integrate various channels such as social media, email, mobile apps, and in-store experiences to create a seamless and consistent customer journey. By leveraging data analytics and personalization strategies, businesses can better understand their customers needs and preferences, leading to increased satisfaction and retention. As technology continues to evolve, the adoption of advanced omni-channel solutions will likely become even more critical for businesses aiming to stay competitive.

Key Telecom Regulatory Developments/ Litigations

• DoT has directed the TSPs to comply with various license conditions to check/curb misuse of PRIs, Lease Lines, Internet Lease Lines, SIP and IPLC used for generating Spam/ Spam Calls.

• DoT has allocated exclusive numbering series (1600XX) for service and transactional calls as per TCCCPR, 2018 for BFSI, Government entities and regulators.

• DoT has notified the Right of Way rules under the Telecommunications Act, 2023 prescribing how telecommunication infrastructure can be installed over public and private property. Public entity shall not levy any fees, charges, rent, annuity, or any other financial contribution, for establishment, operation and maintenance of telecom network in property other than public property.

• DoT has notified Telecommunications (Critical Telecommunication Infrastructure) Rules, 2024. Every telecommunication entity shall ensure that Critical Telecommunication Infrastructure, including any spares, hardware and software used in such Infrastructure, are in compliance with the defined standards, ensure security of Critical Telecommunication Infrastructure, maintain a complete list of Critical Telecommunication Infrastructure, maintain records of the supply chain of the telecommunication equipment. The Chief Telecom Security Officer shall be responsible for the implementation of these rules.

• Government has notified Telecommunications (Procedures and Safeguards for Lawful Interception of Messages) Rules, 2024 covering the provisions related to authority for Interception of any message or class of messages pursuant to interception order on occurrence of any public emergency or in the interest of public safety, to be handled only by authorized nodal officers within two hours of receiving the communication.

• DoT has notified Telecommunications (Administration of Digital Bharat Nidhi) Rules, 2024 which stipulates that funds from the Digital Bharat Nidhi will be allocated to projects aimed at improving telecommunication services in underserved & remote areas and for underserved groups of the society, such as, women, persons with disabilities and economically & socially weaker sections.

• DoT has notified the Telecommunication (Temporary Suspension of Services) Rules, 2024, which lay down the process for a government official to issue instructions for the temporary suspension of the telecommunication service. The directions to suspend any telecommunication service shall only be issued by suspension order for a specified duration, not exceeding fifteen (15) days.

• DoT has notified Telecommunications (Cyber Security) Rules, 2024 that aim to safeguard Indias communication networks and services, through a host of measures including specified timelines for telcos to report security incidents and make disclosures.

• Regulatory Sandbox Rules, 2024 have been released by the Central Government for the purposes of encouraging and facilitating innovation and technological development in telecommunication.

• TRAI issued The TCCCP (Second Amendment) Regulations, 2025, which mandates that all commercial communications must be based on explicit customer consent, which should be verifiable and recorded, introduces process for consumers to report unsolicited communications, Imposes stricter penalties for Non-Compliance and Application service providers have been mandated not to randomly tag designated numbers as spam.

• TRAI has issued Recommendation on Revision of National Numbering Plan, addressing numbering resource constraints in Fixed-line Services, Inhibit UCC (Unsolicited Commercial Communication), Spam calls and CLI (Caller Line Identification) spoofing Timeline; and for deactivation of numbering resources for mobile and Fixed line connections.

• TRAI has issued Standards of Quality of Service of Access (Wireline and Wireless) and Broadband (Wireline and Wireless) Service Regulations, 2024, provides for stricter penalty for non-compliance. TRAI has issued direction on measures to curb misuse of Headers and Content Templates under TCCCPR, 2018 & issued milestone dates for TSPs to go live for 140xx services, URL whitelisting and PE-TM Chain Binding.

Major Litigation Dual Technology

No development during the year. The Cellular Operators Association of India ("COAI") challenged the DoT Press Release dated October 19, 2007, allowing the existing licensees to use dual technology, i.e. CDMA operators were permitted to acquire and use GSM spectrum for providing GSM services and vice-versa ("Dual Tech Policy") before TDSAT, which upheld the Dual Tech Policy by order dated March 31,2009. TTML GSM admin spectrum in the 1,800 MHz band was allocated under this Dual Tech Policy in 2008, and it expired on September 29, 2017. COAI challenged the TDSAT order before the Supreme Court, praying that the Dual Tech Policy should be repealed, and the GSM start-up spectrum should be cancelled. The matter was last listed on April 18, 2023, but could not be taken up. The matter will be listed in due course. If the policy is held to be invalid, there could be some financial liability for the past period of about eight years during which this spectrum was held by the Company.

MERC Order on applicability of commercial tariff on Mobile Towers

• By way of Multi Year Tariff Order dated November 3, 2016, passed by the Maharashtra Electricity Regulatory Commission ("MERC"), the mobile towers were re-categorized and covered under the commercial tariff as against the industrial tariff applicable to the mobile towers under the previous tariff orders. The said Tariff Order dated November 3, 2016, was challenged by various telecom operators (including TTML)

as well as IP1 companies before the Appellate Tribunal for Electricity ("APTEL"), Delhi by way of appeals under Section 111 of the Electricity Act and all appeals were clubbed and heard together.

• APTEL vide its judgement dated February 12, 2020, allowed all the appeals thereby holding that the mobile towers shall be categorized under the industrial tariff and not under commercial tariff. In other words, the said order of MERC is now reversed, and the industrial tariff is restored for mobile towers. A Civil Appeal was filed in September 2020 by MSEDCL in the Supreme Court challenging the Order of APTEL dated February 12, 2020.

• The Supreme Court in October 2020 issued notice with an observation that the Telecom/Tower companies shall not recover any monies from MSEDCL which they have paid already under commercial tariff, at this stage and in the meanwhile, the industrial tariff shall continue to apply to all the telecom towers until further orders. In a hearing on January 2, 2024, the Supreme Court passed directions to MSEDCL to raise invoices in terms of the APTEL judgement dated February 12, 2020, and continued the interim order, with regard to recovery, till the final outcome of the present proceedings. The matter was recently listed on April 21, 2025, when the Apex Court adjourned the matter, granting another opportunity to certain other respondents to file counter affidavit. The case is now listed for further proceedings on July 17, 2025.

Note - In the meanwhile, TTML moved its application for ITES certification in August 2020 and obtained the same in February 2021 for its important locations namely the Turbhe office, Navi Mumbai (valid retrospectively from February 2020 to February

2023 and the validity whereof was renewed from February 2, 2023 to February 1,2026), Al-Aqmar office, Pune (valid from January 2021 to January 2024, which has further been renewed until January 2027), Nagpur Technology site (valid from August 2021 to August 2024 which has further been renewed from August 13,

2024 to August 12, 2027) and Nashik Technology site (valid from February 2022 to July 2024 and which has further been renewed from July 19, 2024 to July 14, 2027). By this certification, TTML is entitled to draw power supplies under industrial tariff in these locations and the adverse Court order, if any, shall not have impact on industrial tariff for these locations being charged presently.

Please refer to Notes to Accounts for the following litigations:

i. Mumbai Circle TERM Penalty

ii. One Time Spectrum Charges

iii. Pune Municipal Corporation Property Tax bill for Al-Aqmar Office

iv. Definition of Gross Revenue (GR) and Adjusted Gross Revenue (AGR)

Risks and Concerns

This section discusses the various aspects of enterprise-wide risks management. It might be noted that the risk related information outlined here is not exhaustive and is for informational purpose only.

Internal Control Systems and their Adequacy Enterprise Risk Management

Enterprise Risk Management ("ERM") is a comprehensive and structured approach to risk identification, risk assessment, risk response, and risk monitoring. The Company has formulated a well-defined and dynamic ERM framework which gets reviewed and updated periodically. The framework is governed by a comprehensive risk management policy, which, amongst others, includes the risk management governance structure and the risk management process.

Results of the risk management activities are periodically reviewed by the management and bi-annually presented to the Risk Management Committee of the Board.

The risk management process enables proactive identification, recording, tracking of risks and monitoring of mitigation plans to respond to changes in business and regulatory environment. The ERM framework aims to realize the following benefits for the organization:

• Enhance risk management

• Improve decision-making

• Enhance risk awareness

• Improve governance and accountability

• Improve business continuity

• Enhance credibility with key stakeholders such as investors, employees, government, regulators, society, etc.

• Protect and enrich stakeholder value

The risk management process is embedded in the Companys work systems including the planning and review process, thereby reassuring all stakeholders, customers, investors, employees, and partners in respect of the Companys business sustainability.

Risk Environment

The risk management process facilitates the proactive identification, documentation, and tracking of risks, as well as the supervision of mitigation strategies to address changes across various risk categories. The Company encounters numerous risks; hence, maintaining an efficient and adaptable risk management process is crucial for mitigating their impact. The primary risks facing the Company include:

The risk management process is integrated into the Companys work systems, including planning and review, to ensure business sustainability for all stakeholders. Some of the key risks are mentioned below:

# Risks

1 Macroeconomic & Geopolitical

• The macroeconomic situation, global conflicts along with the Trusted Cell compliance and mandatory telecom testing requirements may impact network expansion, customer delivery timelines as well as customer demand

• Recent trade tariffs from the US likely to impact business across sectors. Although, IT/ITeS sector has not been directly tariffed but could suffer from indirect budget contractions and project deferrals in the US

2 Industry & Customer landscape

• A lack of understanding of the evolving industry landscape and customer needs could affect new customer acquisitions and revenue growth

• Traditional Voice and A2P SMS/Messaging revenues impacted by growth of alternative Cloud based Communication solutions, IP based messaging solutions

• Impact on overall profitability due to aggressive competition in data for SME & Carrier Segments, Commoditization of A2P messaging services and low margins in Cloud & SaaS license resell business

3 Technology

Our ability to launch products quickly and deliver top-quality services hinges on the modernization of our technology, encompassing both the network and our systems stack

4 Information Security

Potential cybersecurity threats to data integrity, confidentiality and availability, leading to operational disruptions, financial losses, and reputational harm

Mitigation steps

• Develop alternative vendor eco system - Global & Indian

• Trusted Cell compliance through enhanced engagement with Trusted cell, Awareness about Trusted Tag/MTCTE approval process and development of alternate vendors wherever possible

• Segments potentially affected by tariffs have been identified. TTL will maintain close engagement with customers in these segments to ensure continued business. Additionally, TTL will focus on expanding business from other segments that are not impacted by the tariffs

• Continuous new product development, building relevant propositions either inhouse or through partnerships based on a comprehensive customer insight process

• Build & Scale Unified Communications Portfolio - Smartflo Cloud Communication Suite, Integrated Voice Services on UCaaS in Partnership with Microsoft

• Scale high-margin value business including connectivity, Managed Services, Security, among others

• Network - Technology refresh of network and IT equipment that is End-of-Life and support

• Relevant investments in process re-engineering and application refresh

• Strengthen security posture of IT infrastructure

• Continuous security risk assessment

• Deploy TPRM framework for third party vendor & partners

# Risks

5 People Risks across Talent, Skill Development

• Our ability to attract, develop, and retain talent

• Insufficient depth in leadership pipeline, potentially impacting organizational continuity and strategic execution

6 Financial, Legal & Regulatory

Despite UCC regulations being in place for a while, overall complaints have not decreased. The regulator has enforced stricter controls to push the industry towards further action, potentially leading to revenue loss and penalties

Mitigation steps

• Hiring specialist talent to drive growth of the Cloud & Platforms portfolio

• Enhance skills for employee and the ecosystem via focused development programmes and digital certifications

• Foster a collaborative culture with initiatives promoting experimentation, accountability and continuous learning

• Succession planning for leadership (N-1)

Ensuring compliance with regulation while driving:

• Customer awareness programmes

• Collaborating with industry and regulator

Internal Audit

An Audit Committee of the Board of Directors has been constituted as per the provisions of Section 177 of the Companies Act, 2013 (the "Act").

The internal audit for various processes across functions is conducted by the independent firm. The audit firm carry out exhaustive audits. Internal audit reports are presented to the management.

The Internal Audit reports are reviewed by the Audit Committee and appropriate actions are taken wherever necessary.

Opportunities and Threats

Opportunities

The transition to hybrid work models has led companies to place greater emphasize on digital transformation. This increased focus is driving the adoption of agile, cost-effective, and secure ICT solutions, particularly in Unified Communications, as well as Cloud and SaaS offerings.

Public and hybrid cloud solutions are gaining traction due to their simplicity and cost-efficiency, which is resulting in a demand for reliable internet access services and a re-evaluation of traditional enterprise network infrastructure. This shift opens opportunities for solutions such as Internet Leased Line and SD-WAN.

As businesses expand their digital presence and adopt remote work setups, security remains a paramount concern, leading to a rise in the implementation of enterprise security solutions. Moreover, the aim of achieving omni-channel customer engagement, enhanced experiences, and brand loyalty is driving the demand for advanced business communication and marketing solutions, including cloud communications and omnichannel platforms like WhatsApp for Business.

While traditionally lagging behind large enterprises, the Indian SME sector is progressively adopting technology, supported by the increasing reliability and affordability of cloud infrastructure, competitively priced internet access services, and accessible UC platforms and services.

Threat to traditional Enterprise Voice and Data Services

Considering the transition to hybrid work models, there has been a notable surge in the adoption of IP/web-based communication and collaboration solutions, signalling a foreseeable decline in traditional voice services. To address this evolving landscape, the Company is proactively diversifying its portfolio with an emphasize on expanding SIP Trunking, Cloud-based Communication, and Unified Communication (UC) solutions, thereby mitigating potential risks associated with the declining demand for traditional voice services.

From an enterprise data perspective, use cases like 5G Fixed Wireless Access (FWA) and private networks might pose a potential risk to some parts of existing and future revenue streams for enterprise data services. Overall, the Company estimates that the risk of 5G impacting enterprise data services for SMEs over the next 3-5 years remains low. This is primarily because fiber optics offer superior performance and reliability at a lower cost. Furthermore, most global deployments of 5G Fixed Wireless Access (FWA) have been for selective use cases where deploying fiber is challenging.

Although the margin risk remains a concern, declining data service prices due to increased competition pose a potential threat to the Companys margins. Aggressive pricing strategies and bundled offers from new entrants in the Small and Medium Enterprise (SME) segment could further impact margins and increase customer churn. Additionally, the improvement in broadband quality in India may pose a risk to revenue from Internet Leased Line (ILL) and Multi-Protocol Label Switching (MPLS) services for micro and small businesses.

To address these challenges, the Company is diversifying its product portfolio to include value-added connectivity offerings. This includes innovative products such as Smart Internet Lease Line, ILL Burstable Bandwidth, Software-Defined Wide Area Network (SDWAN), and SmartOffice? Broadband. The Company remains proactive in exploring new products and technology options to mitigate potential threats and capitalize on emerging opportunities. By continually innovating and adapting to market demands, the Company aims to stay ahead of the competition and secure its position in the rapidly evolving telecommunications landscape.

Human Resources

The Company had 390 employees on its rolls as on March 31,2025. Please refer to "HR Initiatives" under Directors Report.

Quality and Processes

Like other companies in the Tata Group, the Company has embraced the Tata Business Excellence Model ("TBEM") as an organizational improvement framework. TBEM focuses on key facets of business performance, including Leadership, Strategy, Customer, Data, Organizational Learning & Innovation, People & Culture, and Operations, along with their measurable outcomes to drive continuous improvement and excellence.

In line with its commitment to quality, the Company has established robust management systems, including the Quality Management System (QMS), Information Security Management System (ISMS), and Business Continuity Management System (BCMS), all based on ISO Standards.

To enhance service quality and customer experience, the Company has undertaken various improvement projects across areas such as customer lifecycle management, product and service design & delivery, network augmentation, risk management, and quality control. The Company will continue to invest in and accelerate its journey towards business and the excellence process, ensuring sustainable growth and customer satisfaction.

Key Financial Information & Operational Performance

Revenue from Operations

Revenue from Operations for the year ended March 31, 2025, increased to H 1,308 Crores as against H 1,192 Crores in the previous year.

Other Income

Other income during the year stood at H 16 Crores (previous year H 18 Crores) which included other operating income to the tune of H 8 Crores (previous year H 9 Crores).

Operating Expenses

Operating expenses for the year were recorded at H 737 Crores as against H 664 Crores in the previous year. The major components of the total operating expenses are as follows:

Net Loss

The Companys loss before exceptional items was H 1,275 Crores as compared to last year level of H 1,228 Crores. There are no exceptional items in the current year similar to the previous year and the Company reported a net loss of H 1,275 Crores during the year, as compared to H 1,228 Crore in last year.

Balance Sheet

The Shareholders Funds was H 19,570 Crores (Negative) as on March 31, 2025, against H 19,253 Crores (Negative) as on March 31, 2024.

Total borrowing for the Company (including long term borrowing, short term borrowing, current maturities of long-term borrowing, debt components of ICDs and deferred spectrum liability including interest) was H 18,565 Crores (excluding liability component of RPS) as compared to H 18,014 Crores in the previous year.

The Net Block (including tangible as well as intangible assets) as on March 31, 2025, increased to H 686 Crores as compared to H 662 Crores in the previous year. The Company has Capital Work in Progress of H 35 Crores and Right of use Assets of H 112 Crores.

Significant Changes in Key Financial Ratios

The key financial ratios are as under:

Particulars	2024-25 ¦	2023-24
Operating Profit Margin (%)	31%	32%
Net Profit Margin (%)	(97%)	(103%)
Return on Net Worth (%)2	NA	NA
Debt Service Coverage Ratio (DSCR)3	0.06	0.08
Interest Service Coverage Ratio (ISCR)3	0.84	0.80
Debt Equity Ratio	(1.04)	(1.04)
Current Ratio	0.61	0.54

Operating Profit Margin: Earning from Operation divided by Revenue from Operations (Earning from operations = EBITDA net of Dep and Other Income)

Net Profit Margin: PAT divided by Revenue from operations.

Debt Service Coverage Ratio: EBITDA divided by total debt and interest payable in a year (debt includes principal repayment of long-term borrowings repayable within 12 months, interest on term loans, interest on deferred payment liability and license fees and interest on inter-corporate deposits).

Interest Service Coverage Ratio: EBITDA divided by Interest expense (interest expense includes interest on term loans, interest on deferred payment liability and license fees and interest on inter-corporate deposits).

Debt Equity Ratio: Total Debts divided by Total Equity. (Total debt includes current borrowings and non-current borrowings).

Current Ratio: Current Assets divided by current liabilities (Current Liabilities excluding short-term borrowings).

Note:

1 Provision for LF/SUC H 269 Crores made during FY25.

2 Due to negative net worth, this ratio is not computed.

3 Interest expenses exclude notional interest and other finance charges.

Company Outlook

The Company is poised for significant growth in the forthcoming years. This growth is anticipated to be propelled by several strategic factors, including a strong portfolio of Smart Digital Solutions, a robust channel partner ecosystem, an expanding network presence, a strong brand, and a best-in-class and differentiated customer experience. However, the rapidly evolving technology landscape, heightened competition, and shifting macroeconomic conditions necessitate continuous investment in products, people, and infrastructure to maintain growth momentum and market relevance.

Key Drivers of Growth for Tata Tele Business Services

1. Strong Portfolio of Smart Digital Solutions: The Company

boasts a comprehensive array of Smart Digital Solutions designed to meet the diverse needs of businesses across various sectors. These solutions include Connectivity, Business Communications, Security, Marketing, and Managed Services. By continually innovating and adapting its product portfolio, the Company is well-positioned to address the evolving demands of its customers, thereby driving sustained growth.

2. Robust Channel Partner Ecosystem: The strength of TTBS channel partner ecosystem is a significant catalyst for its growth. By fostering strong relationships with an extensive network of partners, TTBS is able to amplify its reach and penetrate new markets more effectively. These partnerships enable the Company to leverage the expertise and local knowledge of its partners, ensuring that its solutions are tailored to meet the specific needs of different regions and industries. This collaborative approach not only enhances TTBS market presence but also drives customer satisfaction and loyalty.

3. Expanding Network Presence: TTBS is committed to expanding its network infrastructure to support its growing customer base. By asset-lite investment in expansion of its network through reliable partnerships, the Company ensures reliable and high-quality connectivity for its clients. This expansion is critical in extending TTBS geographical reach and enabling it to serve a broader spectrum of businesses, from small enterprises to large corporations. A robust and extensive network presence is a fundamental pillar of TTBS growth strategy, providing a solid foundation for delivering innovative digital solutions.

4. Strong Brand: The Tata brand is synonymous with trust, quality, and reliability. TTBS benefits immensely from this strong brand reputation, which underpins its market credibility and customer confidence. The association with the Tata Group, lends TTBS an inherent advantage in establishing and maintaining long-term relationships with clients. The strong brand equity not only facilitates business growth but also enables TTBS to differentiate itself in a competitive market.

5. Best-in-Class and Differentiated Customer Experience:

TTBS places a strong emphasize on delivering an exceptional customer experience. By providing personalized and responsive service, the Company ensures high levels of customer satisfaction and retention. The Companys commitment to understanding and addressing the unique needs of its clients sets it apart from competitors. This customer-centric approach, combined with the deployment of advanced technologies to enhance service delivery, positions TTBS as a preferred partner for businesses seeking reliable and innovative digital solutions.

The technology and competitive landscape is constantly evolving, presenting both opportunities and challenges for TTBS. To stay ahead, the Company must continuously innovate and adapt its offerings to incorporate the latest technological advancements. This requires substantial investment in product development, as well as strategic collaborations with technology leaders.

Conclusion

In summary, Tata Tele Business Services is well-positioned to achieve significant growth in the coming years, driven by a strong portfolio of Smart Digital Solutions, a robust channel partner ecosystem, an expanding network presence, a strong brand, and a best-in-class and differentiated customer experience. However, the Company must remain committed to investing in its products, people, and infrastructure to sustain this growth and maintain its market relevance in the face of rapidly evolving technological, competitive, and macroeconomic landscapes. It is essential to note that the expectations and risks outlined in this report represent managements perspectives and may not necessarily materialize.