NELCO Ltd., a subsidiary of Tata Power Company Ltd., reported lower-than-expected financial results for the first quarter of FY25, leading to a significant drop in its stock price. The company’s net profit for the quarter fell by 20.4 percent year-on-year to Rs 4.6 crore, while revenue from operations decreased by 6 percent to Rs 74.1 crore.
The market reacted negatively to these results, with NELCO’s shares falling as much as 4 percent to an intraday low of Rs 865. By 1:55 PM, the stock had slightly recovered but was still down over 2 percent, trading at Rs 886. Despite these recent losses, NELCO’s stock has gained 7 percent over the past six months, though it has underperformed compared to the Nifty 50 index, which gained 12 percent in the same period.
On a sequential basis, NELCO’s net profit declined by 25 percent, with revenue dropping by 9 percent. This is a significant downturn from the same quarter last year when the company reported a net profit of Rs 5.7 crore and revenue of Rs 78.8 crore.
NELCO, originally established as National Radio & Electronics Company in 1940, specializes in providing comprehensive networking solutions. Its offerings include the sale and rental of Very Small Aperture Terminals (VSATs), maintenance of private hubs, and hybrid network solutions. The company has a long history in the technology sector, having been promoted by the Investment Corporation of India to manufacture broadcasting equipment.
The poor Q1 performance highlights the challenges NELCO faces in maintaining profitability and revenue growth, affecting investor sentiment and resulting in the recent decline in its stock price.
Do you have a news tip for Lakshmishree reporters? Please email us at media@lakshmishree.com
News Desk
