Macquarie has reiterated its outperform rating on Tata Communications with a target price of ₹2,210 following the company’s acquisition of a 51% stake in Commotion Inc, an AI-native enterprise SaaS platform operating in the US and India. The all-cash deal of US$25.5 million is expected to strengthen Tata Communications’ expanding digital solutions portfolio and deepen its offerings in customer engagement and enterprise automation.
The brokerage noted that Tata Communications’ digital portfolio contributed roughly 40% of its consolidated revenue in FY25, with the Customer Interaction Suite (CIS) forming around half of that contribution. The CIS business has seen notable traction since the US$250 million acquisition of CPaaS platform Kaleyra in 2023, and Macquarie believes the latest acquisition further reinforces management’s strategic intent to scale this vertical.
According to the brokerage, Tata Communications has identified CIS as one of its five core strategic bets as it pivots towards higher-margin, platform-led services. The firm expects integration synergies, cross-selling potential and a broadening client base to support revenue visibility and margin expansion over the medium term. Macquarie added that the company’s ongoing investments in AI-driven enterprise solutions are transforming its positioning from a traditional connectivity provider to a diversified digital ecosystem player.
Disclaimer: The views and recommendations above are those of Macquarie. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
