Tata Communications Limited — Interim / Quarterly Report 2021

Jan 19, 2021

HQ/CS/CL.248/17057 January 19, 2021

National Stock Exchange of India Limited Exchange Plaza, Sandra Kurla Complex, Mumbai - 400 051 SYMBOL: TATACOMM

BSE Limited P.J. Towers, Dalal Street, Mumbai - 400 001 Scrip Code: 500483

Dear Sir I Madam,

Sub: Unaudited Financial Results of Tata Communications Limited ("the Company") for the quarter ended December 31, 2020.

Pursuant to Regulation 33 read with Regulation 30 and Regulation 52 of the SEBI (Listing Obligations· and Disclosure Requirements) Regulations, 2015, we enclose the unaudited standalone and consolidated financial results of the Company for the quarter ended December 31, 2020, which have been approved and taken on record at the meeting of the Board of Directors of the Company held today (Attachment A), along with the Limited Review Report issued by S.R. Batliboi & Associates, LLP, Statutory Auditors of the Company (Attachment B).

A press release in this regard is also enclosed at (Attachment C).

The aforesaid documents are also available on the website of the Company at www.tatacommunications.com.

The meeting of the Board of Directors commenced at 13:00 hours IST and concluded at 16:45 hours IST.

Thanking you, Yours faithfully, kmmunications Limited

Sudipto Das Deputy General Manager

TATA COMMUNICATIONS

Tata Communications Limited Regd. Office . VSB Mahatma Gandhi Road Fort Mumbai - 400 001 Tel: 91 22 6659 1968 email: Sudipto.das@tatacommunications.com CIN no.: L64200MH1986PLC039266 website: www.tatacommunications.com

TATA COMMUNICATIONS LIMITED

REGD. OFFICE: VSB, M.G. ROAD, FORT, MUMBAI-400001.

A. STATEMENT OF STANDALONE UNAUDITED FINANCIAL RESULTS FOR THE QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2020

	Particulars		For the quarter ended		For the nine months ended		For the year ended
		2020	December 31 September 30 December 31 2020	2019	December 31 2020	December 31 2019	March 31 2020
	(Refer notes below)	(unaudited)	(unaudited)	(unaudited)	(unaudited)	(unaudited)	(audited)
1	Income from operations	154448	159215	141868	464698	426140	575033
$\overline{2}$	Other income, net	3927	15726	3088	23203	15123	18027
3	Total Income (1+2)	158375	174941	144956	487901	441263	593060
$\overline{4}$	Expenses
	a. Network and transmission expense	48089	48891	48193	144147	141669	184235
	b. Employee benefits expense	29169	27068	24088	82688	73736	99883
	c. Finance costs	2478	2778	1527	8346	3862	5519
	d. Depreciation and amortisation expense	22671	23896	23602	70384	69359	97744
	e. Other expenses	30578	29107	31880	89184	95528	133709
	f. Total expenses (4a to 4e)	132985	131740	129290	394749	384154	521090
5	Profit from ordinary activities before exceptional items and tax $(3 - 4)$	25390	43201	15666	93152	57109	71970
6	Exceptional items (Refer note 2)	(1143)	5330		3138	(592)	(34615)
$\overline{7}$	Profit / (Loss) from ordinary activities before tax $(5 + 6)$	24247	48531	15666	96290	56517	37355
8	Tax expense/ (benefit):
	a. Current tax	7622	9651	4636	25441	18388	23848
	b. Deferred tax	(1467)	(993)	(324)	(4483)	2562	(7371)
$\overline{9}$	Profit / (Loss) for the period $(7 - 8)$	18092	39873	11354	75332	35567	20878
10	Other Comprehensive Income / (Loss) (net of tax)	(456)	1023	(531)	(672)	(2639)	(3201)
11	Total Comprehensive Income / (Loss) $(9 + 10)$	17636	40896	10823	74660	32928	17677
12	Paid up equity share capital (Face value of $\bar{\mathbf{z}}$ ) 10 per share)	28500	28500	28500	28500	28500	28500
13	Reserves excluding Revaluation reserve						772954
14	Earnings per share (of ₹10/- each) (not annualised)
	Basic and diluted earnings per share $(\bar{\mathbf{x}})$	6.35	13.99	3.98	26.43	12.48	7.33

(₹ in Lakhs)

B. Standalone Business Segment Information:
i. Segment wise revenue and results:

		For the quarter ended		For the nine months ended	(₹ in Lakhs) For the year ended
Particulars	December 31 2020	September 30 20 20	December 31 2019	December 31 2020	December 31 2019	March 31 2020
	(unaudited)	(unaudited)	(unaudited)	(unaudited)	(unaudited)	(audited)
Income from Operations
Voice Solutions	2500	6583	3496	14134	16464	20232
Data and Managed Services	147865	148502	134806	438077	398528	537976
Real Estate	4083	4130	3566	12487	11148	16825
Total	154448	159215	141868	464698	426140	575033
Segment result
Voice Solutions	(7446)	(6571)	(7719)	(23678)	(20681)	(29090)
Data and Managed Services	28668	34435	19652	94063	59628	77500
Real Estate	2719	2389	2172	7910	6901	11052
Total	23941	30253	14105	78295	45848	59462
Less:
(i) Finance Costs	2478	2778	1527	8346	3862	5519
(ii) Other un-allocable (income) net of un-allocable expenses	(2784)	(21056)	(3088)	(26341)	(14531)	16588
Profit before taxes	24247	48531	15666	96290	56517	37355

ii. Segment Assets and Liabilities:

				(₹ in Lakhs)
Particulars	As on
	December 31 2020	September 30 2020	December 31 2019	March 31 2020
Segment Assets
Voice Solutions	10964	12820	14173	12227
Data and Managed Services	621273	642194	664645	638791
Real Estate	49886	48862	47543	50111
Unallocable Assets	763098	725523	589562	647840
Total Assets	1445221	1429399	1315923	1348969
Segment Liabilities
Voice Solutions	17450	18692	19040	18976
Data and Managed Services	330521	318833	346454	338661
Real Estate	13809	13288	21640	9871
Unallocable Liabilities	198121	210902	91478	159401
Total Liabilities	559901	561715	478612	526909

iii. Notes to Segments:

The Company's operating segments comprises of Voice Solutions, Data and Managed Services and Real Estate. The composition of the operating segments is as follows:

Voice Solutions include International and National Long Distance Voice services.

Data and Managed Services include corporate data transmission services, virtual private network, signaling and roaming services, television and other network and managed services.

Real Estate includes lease rentals for premises given on lease.

Notes to standalone financial results:

$1$ The above standalone unaudited financial results of the Company for the quarter and nine months ended December 31, 2020 have been subjected to a limited review by the statutory auditors. These results have been reviewed by the audit committee and taken on record and approved by the Board of Directors at their meeting held on January 19, 2021.

1. Details of exceptional items are listed below

	For the quarter ended			For the nine months ended	For the year ended
	31 20 20	30 20 20	December September December 31 2019	December 31 2020	December 30 2019	March 31 2020
1. Provision Towards advances (refer note a)				$\sim$	(592)	(592)
2. Staff cost optimization (refer note b)		(228)		(228)	$\overline{\phantom{a}}$	141
Provision towards 3. License Fees (refer note $\mathbf{C}$	(1143)	(1180)		(3372)		(34164)
Gain on sale of fixed 4. assets (refer note d)		6738		6738
Total	(1143)	5330		3138	(592)	(34615)

a. During the year ended March 31, 2020, the Company had recorded an expense of $\xi$ 592 lakhs relating to demerger of surplus land.

b. As part of its initiative to enhance the long-term efficiency of the business, the Company undertook organisational changes to align to the Company's current and prospective business requirements. These changes involved certain positions in the Company becoming redundant.

• c. During the year ended March 31, 2020 the Company made a provision towards licence fees of ₹34164 lakhs which includes ₹33717 lakhs towards the period covered in the DOT demand (Refer note 3). Further the Company made a provision of ₹1143 lakhs and ₹ 3372 lakhs towards interest on the unpaid provisions for the quarter and nine months ended December 31, 2020.
• d. During the quarter ended September 30, 2020, the Company concluded the sale off a parcel of its land along with building on such land, for a total consideration of $\xi$ 6741 lakhs (net of transaction cost) resulting in to a gain of $\xi$ 6738 lakhs. These assets were disclosed under assets held for sale.

$(\xi$ in Lakhs)

1. During the quarter ended September 30, 2019, the Company had received demands from Department of Telecommunications (DOT) aggregating to ₹ 663343 lakhs towards License Fee on its Adjusted Gross Revenue (AGR) for the financial years 2006-07 till 2017-18.

The demands received by the Company included an amount of $\xi$ 543370 lakhs which were disallowed by the DOT towards the cost adjusted to Gross Revenues by the Company that were claimed on 'accrual basis' instead of payment basis, for which revised statements on the basis of actual payment has been submitted to the DOT. Though, the Company believes that it has a case to defend, it has made a provision of ₹ 33717 lakhs during the quarter ended March 31, 2020 and for the balance amount of ₹ 509653 lakhs, the Company believes that the likelihood of the same materializing is remote since the deduction on payment basis has not been considered by the DOT.

With respect to demands for the balance amount of ₹ 119973 lakhs, the Company has existing appeals relating to its ILD & NLD licenses which were filed in the past and are pending at the Hon'ble Supreme Court and Hon'ble Madras High Court and the Company's appeals are not included in the Hon'ble Supreme Court ruling of October 24, 2019 on AGR. Further, the Company believes that all its licenses are different from UASL, which was the subject matter of Supreme Court judgement of October 24, 2019. The Company has responded to the DOT denying and disputing the amounts claimed by the DOT in the above mentioned demands. The Company has not received any response from the DOT after the submission. The Company believes that it will be able to defend its position and also has obtained a legal opinion in this regard. Accordingly, the Company has assessed the balance demand of ₹ 119973 lakhs as part of contingent liability.

1. The Company has exercised the option of lower tax rate of 25.17% (inclusive of surcharge and cess) permitted under section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) Act, 2019. Accordingly, the Deferred Tax Assets (net) as at March 31, 2019 have been re-measured. Consequently, tax expense for year ended March 31, 2020 includes a charge of ₹ 6764 lakhs.

2. Previous periods' figures have been reclassified wherever necessary to conform to the current period classifications/disclosures.

TATA COMMUNICATIONS LIMITED

REGD. OFFICE: VSB, M.G. ROAD, FORT, MUMBAI-400001.

$(\overline{\overline{\varsigma}}$ in lakhs)

C. STATEMENT OF CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2020

			For the quarter ended			For the nine months	year
	Particulars					ended	ended
		December 31	September	December	December	December	March
		2020	30 20 20	31 2019	31 20 20	31 2019	31 2020
		(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Audited)
	1 Income from operations	422283	440108	422872	1302685	1267010	1706799
2	Other income, net	822	7610	1397	9906	3235	6968
3	Total income $(1 + 2)$	423105	447718	424269	1312591	1270245	1713767
4	Expenses a. Network and transmission expense	155286
	b. Employee benefits expense	77001	163489 76194	168398 74624	492909	508896	677756
	c. Finance costs	10443	10641	11612	229439 32713	224690 34757	303914 47074
					171884	167100
	d. Depreciation and amortisation expense	55698	57193	56051			235772
	e. Other expenses	85386	84672	103769	255798	291413	396234
	Total expenses (4a to 4e)	383814	392189	414454	1182743	1226856	1660750
	5 Profit before exceptional items, tax & share of profit/(loss) of associates (3 - 4)	39291	55529	9815	129848	43389	53017
	6 Exceptional items (Refer note 2)	(1143)	(5395)		(7587)	(1240)	(39051)
	7 Profit from operations before tax and	38148	50134	9815	122261	42149	13966
	share of profit/(loss) of associates $(5 + 6)$
	8 Tax expense/ (benefit): (Refer note 5)
	a. Current tax	9914	12678	5316	34474	23135	33418
	b. Deferred tax	(2801)	(1144)	(1261)	(7706)	516	(10751)
	9 Profit/(loss) before share of profit/(loss) of associates (7 - 8)	31035	38600	5760	95493	18498	(8701)
	10 Share in Profit/(Loss) of associates	(94)	(119)	125	(264)	518	218
	11 Profit/ (loss) for the period $(9 + 10)$	30941	38481	5885	95229	19016	(8483)
	Attributable to:
	Equity holders of the parent	30915	38448	5854	95143	18906	(8596)
	Non-controlling interest	26	33	31	86	110	113
	12 Other Comprehensive Income/(loss) (net of tax)	8383	22868	(4927)	28587	(25991)	(69311)
	13 Total Comprehensive income/(loss) $(11+12)$	39324	61349	958	123816	(6975)	(77794)
	Attributable to:
	Equity holders of the parent	39298	61316	927	123730	(7085)	(77907)
	Non-controlling interest	26	33	31	86	110	113
	14 Paid up equity share capital (Face value of	28500	28500	28500	28500	28500	28500
	₹10 per share)
	15 Reserves excluding Revaluation reserve						(176942)
	16 Earnings per share (of ₹ 10/- each) (not annualised)
	Basic and diluted earnings per share $(\bar{\mathfrak{F}})$	10.85	13.49	2.05	33.38	6.63	(3.02)

D. Consolidated Business Segment Information:

i. Consolidated Segment wise revenue and results:

$(\overline{\zeta}$ in Lakhs)
Particulars		For the quarter ended		For the nine months ended	For the year ended
	December 31 2020	September 30 2020	December 31 2019	December 31 2020	December 31 2019	March 31 2020
	(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)	(Audited)
Income from operations
Voice Solutions	67426	75892	80888	223250	257327	337622
Data and Managed Services	344919	354292	329908	1050147	973472	1319248
Payment Solutions	5914	5805	8744	16944	26142	34341
Real Estate	4419	4417	3828	13417	11891	17906
Less: Inter Segment Revenue	(395)	(298)	(496)	(1073)	(1822)	(2318)
Total	422283	440108	422872	1302685	1267010	1706799
Segment result
Voice Solutions	1070	4074	3977	10910	19606	23312
Data and Managed Services	47376	55468	13947	142576	51146	65161
Payment Solutions	(2350)	(3381)	(67)	(8965)	(2679)	(6288)
Real Estate	2816	2399	2173	8134	6838	10938
Total	48912	58560	20030	152655	74911	93123
Less:
(i) Finance Costs	10443	10641	11612	32713	34757	47074
(ii) Other un-allocable (income)	321	(2215)	(1397)	(2319)	(1995)	32083
net of un-allocable expenditure
Profit before tax	38148	50134	9815	122261	42149	13966

ii. Consolidated Segment Assets and Liabilities:

				$(\overline{\mathfrak{k}}$ in Lakhs)
			As at
Particulars	December 31 2020	September 30 2020	December 31 2019	March 31 2020
	(Unaudited)	(Unaudited)	(Unaudited)	(Audited)
Segment Assets
Voice Solutions	42508	50956	46716	45304
Data and Managed Services	1480945	1520412	1583331	1588136
Payment Solutions	31922	37056	41616	39422
Real Estate	47744	46551	43987	46586
	1603119	1654975	1715650	1719448
Unallocated Assets	587775	594356	407315	496699
Total Segment Assets	2190894	2249331	2122965	2216147
Segment Liabilities
Voice Solutions	70225	75029	73456	75354
Data and Managed Services	928160	943741	990605	1033212
Payment Solutions	24503	26382	23554	24923
Real Estate	13924	13375	21704	10000
	1036812	1058527	1109319	1143489
Unallocated Liabilities	1167571	1245195	1070186	1200019
Total Segment Liabilities	2204383	2303722	2179505	2343508

iii. Notes to Segments:

The Group's (the Company and its subsidiaries together referred to as "the Group") operating segments comprise of Voice Solutions, Data and Managed Services, Payment Solutions and Real Estate. The composition of the operating segments is as follows:

Voice Solutions includes International and National Long Distance Voice services.

Data and Managed Services includes corporate data transmission services, virtual private network, signaling and roaming services, television and other network and managed services, data center services.

Payment Solutions includes end-to-end ATM deployment, end-to-end POS enablement, hosted core banking, end to end financial inclusion and card issuance and related managed services and switching services to banking sector carried out by the Company's wholly owned subsidiary Tata Communications Payment Solutions Limited.

Real Estate segment includes lease rentals for premises given on lease.

Notes to consolidated financial results:

• 1. The above consolidated unaudited results of the Group for the quarter and nine months ended December 31, 2020 have been subjected to a limited review by the statutory auditors. These results have been reviewed by the audit committee and taken on record and approved by the Board of Directors at their meeting held on January 19, 2021.
• 1. Details of exceptional items are listed below

$(\bar{\bar{\zeta}}$ in lakhs)

Particulars		For the quarter ended		For the nine months ended		For the year ended
	December 31 September December 2020	30 20 20	31 2019	December 30 20 20	December 31 2019	March 31 2020
Gain on sale of assets held for sale (refer note a)		6738		6738
Provision towards advances (refer note b)					(592)	(592)
Loss on sale of investment 3.	$\overline{\phantom{a}}$				(648)	(648)
Provision towards License 4. Fee (refer note c)	(1143)	(1180)		(3372)	$\blacksquare$	(34164)
Staff cost optimization (refer 5. note d)		(10953)	-	(10953)	$\blacksquare$	(3647)
Total	(1143)	(5395)	$\overline{\phantom{0}}$	(7587)	(1240)	(39051)

a) During the quarter ended September 30, 2020, the Company concluded the sale off a parcel of its land along with building on such land, for a total consideration of ₹ 6741 lakhs (net of transaction cost) resulting in to a gain of ₹ 6738 lakhs. These assets were disclosed under assets held for sale.

• b) During the year ended March 31, 2020, the Company had recorded an expense of $\bar{\xi}$ 592 lakhs relating to demerger of surplus land.
• c) During the year ended March 31,2020 the company made a provision towards license fees of $\bar{\tau}$ 34164 lakhs which includes ₹33717 lakhs towards the period covered in the DOT demand (Refer note 3). Further the Company made a provision of $\bar{\zeta}$ 1143 lakhs and $\bar{\zeta}$ 3372 lakhs towards interest on the unpaid provisions for the quarter and nine months ended December 31, 2020.
• d) As part of its initiative to enhance the long-term efficiency of the business, the Group undertook organisational changes to align to the Group's current and prospective business requirements. These changes involved certain positions in the Group becoming redundant.
• 1. During the quarter ended September 30, 2019, the Company had received demands from Department of Telecommunications (DOT) aggregating to $\bar{\mathfrak{c}}$ 663343 lakhs towards License Fee on its Adjusted Gross Revenue (AGR) for the financial years 2006-07 till 2017-18.

The demands received by the Company included an amount of $\bar{\xi}$ 543370 lakhs which were disallowed by the DOT towards the cost adjusted to Gross Revenues by the Company that were claimed on 'accrual basis' instead of payment basis, for which revised statements on the basis of actual payment has been submitted to the DOT. Though, the Company believes that it has a case to defend, it has made a provision of $\bar{\mathfrak{F}}$ 33717 lakhs during the quarter ended March 31, 2020 and for the balance amount of ₹ 509653 lakhs, the Company believes that the likelihood of the same materializing is remote since the deduction on payment basis has not been considered by the DOT.

$\frac{1}{\sqrt{2}}$

With respect to demands for the balance amount of $\bar{\tau}$ 119973 lakhs, the Company has existing appeals relating to its ILD & NLD licenses which were filed in the past and are pending at the Hon'ble Supreme Court and Hon'ble Madras High Court and the Company's appeals are not included in the Hon'ble Supreme Court ruling of October 24, 2019 on AGR. Further, the Company believes that all its licenses are different from UASL, which was the subject matter of Supreme Court judgement of October 24, 2019. The Company has responded to the DOT denying and disputing the amounts claimed by the DOT in the abovementioned demands. The Company has not received any response from the DOT after the submission. The Company believes that it will be able to defend its position and also has obtained a legal opinion in this regard. Accordingly, the Company has assessed the balance demand of $\bar{\tau}$ 119973 lakhs as part of contingent liability.

• During the quarter ended September 30, 2019, a subsidiary domiciled abroad, has received a final VAT assessment from VAT authorities for ₹ 13914 lakhs, during the quarter ended December 31, 2019 a final penalty assessment of ₹ 16244 lakhs was also received. On July 1, 2020 the Group has filed its grounds for appeal with the Economic Administrative Court towards the final VAT and penalty assessment which is currently pending for hearing. The management believes that there are grounds to defend its position and has also obtained an external opinion in this regard.
• $5₁$ The Company and its Indian subsidiaries have exercised the option of lower tax rate of 25.17% (inclusive of surcharge and cess) permitted under Section 115 BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) Act, 2019. Accordingly, the Deferred Tax Assets (net) as at March 31, 2019 have been re-measured. Consequently, tax expense for year ended March 31, 2020 includes a charge of ₹7322 lakhs.
• On December 23, 2020, the Group has acquired a controlling stake of 58.1% for a consideration of ₹3288 lakhs in OASIS Smart SIM Europe SAS (OASIS) having net assets of ₹ 3763 lakhs (basis management accounts). The consolidation of OASIS doesn't have any material impact on the financial results for the quarter ended December 31, 2020.
• 1. Previous periods' figures have been rearranged wherever necessary to conform to the current period classifications/disclosures.

For TATA COMMUNICATIONS LIMITED

AMUR S. LAKSHMINARAYANAN MANAGING DIRECTOR & CEO

Place: Mumbai Date: January 19, 2021

Chartered Accountants

12^th Floor. The Ruby 29 Senapati Bapat Marg, Dadar (West) Mumbai - 400 028, India Tel: +91 22 6819 8000

Independent Auditor's Review Report on the Quarterly and Year to Date Unaudited Standalone Financial Results of the Company Pursuant to the Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended

Review Report to The Board of Directors Tata Communications Limited

• We have reviewed the accompanying statement of unaudited standalone Ind AS financial results of 1. Tata Communications Limited (the 'Company') for the quarter ended December 31, 2020 and year to date from April 1, 2020 to December 31, 2020 (the 'Statement') attached herewith, being submitted by the Company pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the 'Listing Regulations').
• This Statement, which is the responsibility of the Company's Management and approved by the $2.$ Company's Board of Directors, has been prepared in accordance with the recognition and measurement principles laid down in Indian Accounting Standard 34, (Ind AS 34) "Interim Financial Reporting" prescribed under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India. Our responsibility is to express a conclusion on the Statement based on our review.
• We conducted our review of the Statement in accordance with the Standard on Review Engagements $\overline{3}$ . (SRE) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
• Based on our review conducted as above, nothing has come to our attention that causes us to believe 4. that the accompanying Statement, prepared in accordance with the recognition and measurement principles laid down in the aforesaid Indian Accounting Standards ('Ind AS') specified under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India, has not disclosed the information required to be disclosed in terms of the Listing Regulations, including the manner in which it is to be disclosed, or that it contains any material misstatement.

Chartered Accountants

Tata Communications Limited Limited Review Report - December 31, 2020

As fully discussed in note 3 to the standalone Ind AS results for the period, the Company had received 5. demands dated September 12, 2019 from Department of Telecommunications (DoT) towards license fee on its Adjusted Gross Revenue (AGR) for FY 2006-07 to 2017-18, for Rs 663,343 lakhs, Of this amount, the Company during previous financial year had made provision of Rs 33,717 lakhs with respect to the demand of Rs 543,370 lakhs and recorded provision of Rs 1,143 and Rs 3,372 lakhs for the quarter and period ended December 31, 2020, respectively, towards interest on the unpaid amount of provision, and believes that the likelihood of the balance demand materialising is remote. Further, with respect to the demand of Rs 119,973 lakhs, the Company has disclosed the same as part of contingent liability. The Company believes that it has grounds to defend its position and has also obtained a legal opinion in this regard. Our opinion is not modified in this regard.

For S.R. BATLIBOI & ASSOCIATES LLP Chartered Accountants ICAI Firm registration number: 101049W/E300004

per Hormuz Master Partner Membership No.: 110797 UDIN: 21110797AAAAAE1921 Mumbai January 19, 2021

Chartered Accountants

12th Floor, The Ruby 29 Senapati Bapat Marg, Dadar (West) Mumbai - 400 028, India Tel: +91 22 6819 8000

Independent Auditor's Review Report on the Quarterly Unaudited Consolidated Financial Results of the Company Pursuant to the Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended

Review Report to The Board of Directors Tata Communications Limited

• 1. We have reviewed the accompanying statement of Unaudited Consolidated Ind AS Financial Results of Tata Communications Limited (the 'Company' or 'Holding Company') and its subsidiaries (the Holding Company and its subsidiaries together referred to as 'the Group') and its associates for the quarter ended December 31, 2020 and year to date from April 1, 2020 to December 31, 2020 (the 'Statement') attached herewith, being submitted by the Holding Company pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the 'Listing Regulations').
• 1. This Statement, which is the responsibility of the Holding Company's Management and approved by the Holding Company's Board of Directors, has been prepared in accordance with the recognition and measurement principles laid down in Indian Accounting Standard 34, (Ind AS 34) "Interim Financial Reporting" prescribed under Section 133 of the Companies Act, 2013 as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India. Our responsibility is to express a conclusion on the Statement based on our review.
• 1. We conducted our review of the Statement in accordance with the Standard on Review Engagements (SRE) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Institute of Chartered Accountants of India. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the Statement is free of material misstatement. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express and audit opinion.

We also performed procedures in accordance with the Circular No. CIR/CFD/CMD1/44/2019 dated March 29, 2019 issued by the Securities and Exchange Board of India under Regulation 33(8) of the Listing Regulations, to the extent applicable.

1. The Statement includes the results of the entities as referred to in the Annexure.

S.R. Batliboi & Associates LLP, a Limited Liability Partnership with LLP Identity No. AAB-4295 Regd. Office: 22, Camac Street, Block 'C', 3^rd Floor, Kolkata 700 016

Chartered Accountants

Tata Communications Limited Limited review report - December 31, 2020

• 1. Based on our review conducted and procedures performed as stated in paragraph 3 above and based on the consideration of the review reports of another auditor referred to in paragraph 8 below, nothing has come to our attention that causes us to believe that the accompanying Statement, prepared in accordance with the recognition and measurement principles laid down in the aforesaid Indian Accounting Standards ('Ind AS') specified under Section 133 of the Companies Act, 2013, as amended, read with relevant rules issued thereunder and other accounting principles generally accepted in India, has not disclosed the information required to be disclosed in terms of the Listing Regulations, including the manner in which it is to be disclosed, or that it contains any material misstatement.
• 1. As fully discussed in note 3 to the consolidated Ind AS results for the period, the Company had received demands dated September 12, 2019 from Department of Telecommunications (DoT) towards license fee on its Adjusted Gross Revenue (AGR) for FY 2006-07 to 2017-18, for Rs 663,343 lakhs. Of this amount, the Company during previous financial year had made provision of Rs 33,717 lakhs with respect to the demand of Rs 543,370 lakhs and recorded provision of Rs 1,143 and Rs 3,372 lakhs for the quarter and period ended December 31, 2020, respectively, towards interest on the unpaid amount of provision, and believes that the likelihood of the balance demand materialising is remote. Further, with respect to the demand of Rs 119,973 lakhs, the Company has disclosed the same as part of contingent liability. The Company believes that it has grounds to defend its position and has also obtained a legal opinion in this regard. Our opinion is not modified in this regard.
• 1. We draw attention to note 4, which describes the uncertainty related to the outcome of the ongoing tax litigation of Rs 30,158 lakhs, in one of the subsidiaries of the Group. The Group is confident of defending its position and has obtained legal opinion in this regard. Our opinion is not modified on this matter.
• 1. The accompanying Statement includes unaudited interim financial results and other financial information in respect of a subsidiary, whose unaudited interim financial results include total revenues of Rs 1,468 lakhs and Rs 4,401 lakhs, total net profit after tax of Rs. 267 lakhs and Rs. 865 lakhs, total comprehensive income of Rs. 199 lakhs and Rs. 653 lakhs, for the quarter ended December 31, 2020 and the period ended on that date respectively, as considered in the Statement which have been reviewed by their respective independent auditors. The independent auditor's reports on interim financial results of the subsidiary has been furnished to us by the Management and our conclusion on the Statement, in so far as it relates to the amounts and disclosures in respect of the subsidiary is based solely on the report of such auditors and procedures performed by us as stated in paragraph 3 above.
• 1. The accompanying Statement includes Group's share of net loss of Rs 94 lakhs and total comprehensive loss of Rs 88 lakhs, for the quarter ended December 31, 2020 and the Group's share of net loss of Rs 264 lakhs and total comprehensive loss of Rs 262 lakhs, for the period ended December 31, 2020, as considered in the unaudited consolidated financial results, in respect of three associates, based on their interim financial results which have not been reviewed by their auditors. These unaudited interim financial results and other unaudited financial information have been approved and furnished to us by the management and our conclusion on the Statement, in so far as it relates to the affairs of these associates, is based solely on such unaudited interim financial results and other unaudited financial information. According to the information and explanations given to us by the Management, these interim financial results are not material to the Group.

Chartered Accountants

Tata Communications Limited Limited review report - December 31, 2020

Our conclusion on the Statement in respect of matters stated in para 8 and 9 above is not modified with respect to our reliance on the work done and the reports of the other auditors and the financial results and financial information certified by the Management.

For S.R. BATLIBOI & ASSOCIATES LLP Chartered Accountants ICAI Firm registration number: 101049W/E300004

per Hormuz Master Partner Membership No.: 110797 UDIN: 21110797AAAAAF6341

Place: Mumbai Date: January 19, 2021

S.R. BATLIBOL& ASSOCIATES II P

Chartered Accountants

Tata Communications Limited Limited review report - December 31, 2020

Annexure to Independent Auditor's Review Report on the Quarterly Unaudited Consolidated Financial Results of the Company Pursuant to the Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended

List of Subsidiaries and Associates

Subsidiaries

• 1. Tata Communications (America) Inc.
• 1. Tata Communications (Australia) Pty Limited
• 1. Tata Communications (Beijing) Technology Limited
• 1. Tata Communications (Belgium) Sprl
• 1. Tata Communications (Bermuda) Limited
• 1. Tata Communications (Brazil) Participacoes Limitada
• 1. Tata Communications (Canada) Ltd.
• 1. Tata Communications (France) Sas
• 1. Tata Communications (Guam) L.L.C.
• 1. Tata Communications (Hong Kong) Limited
• 1. Tata Communications (Hungary) LLC 12. Tata Communications (Ireland) Dac
• 1. Tata Communications (Italy) S.R.L
• 1. Tata Communications (Japan) K.K.
• 1. Tata Communications (Malaysia) Sdn. Bhd.
• 1. Tata Communications (Middle East) Fz-LLC
• 1. Tata Communications (Netherlands) B.V.
• 1. Tata Communications (New Zealand) Limited
• 1. Tata Communications (Nordic) As
• 1. Tata Communications (Poland) Sp. Z O. O.
• 1. Tata Communications (Portugal) Instalação E Manutenção De Redes, Lda
• 1. Tata Communications (Portugal), Unipessoal Lda
• 1. Tata Communications (Russia) LLC.
• 1. Tata Communications (South Korea) Limited
• 1. Tata Communications (Spain), S.L.
• 1. Tata Communications (Sweden) Ab
• 1. Tata Communications (Switzerland) Gmbh
• 1. Tata Communications (Taiwan) Ltd
• 1. Tata Communications (Thailand) Limited
• 1. Tata Communications (Uk) Limited
• 1. Tata Communications Collaboration Services Pvt Limited
• 1. Tata Communications Comunicações E Multimídia (Brazil) Limitada
• 1. Tata Communications Deutschland Gmbh
• 1. Tata Communications International Pte. Ltd. 35. Tata Communications Lanka Limited
• 1. Tata Communications Move B.V.
• 1. Tata Communications Move Nederland B.V.
• 1. Tata Communications Move Singapore Pte. Ltd.
• 1. Tata Communications Move Uk Limited
• 1. Tata Communications Payment Solutions Limited
• 1. Tata Communications Services (International) Pte. Ltd.
• 1. Tata Communications Sycs Pte Ltd

& ASSO

• 1. Tata Communications Transformation Services (Hungary) Kft.
• 1. Tata Communications Transformation Services (Us) Inc
• 1. Tata Communications Transformation Services Limited

Chartered Accountants

Tata Communications Limited Limited review report - December 31, 2020

• 1. Tata Communications Transformation Services Pte Limited
• 1. Tata Communications Transformation Services South Africa (Pty) Ltd
• 1. Tc lot Managed Solutions Limited (Applied For Strike Off On 29.11.2019)
• 1. Tcpop Communication Gmbh
• 1. Tcts Senegal Limited
• 1. Vsnl Snospv Pte. Ltd.
• 1. Itxc Ip Holdings S.A.R.L.
• 1. Mucoso B.V.
• 1. Netfoundry Inc.
• 1. Nexus Connexion (Sa) Pty Limited
• 1. Sepco Communications (Pty) Limited
• 1. Oasis Smart Sim Europe SAS
• 1. Oasis Smart E-Sim Pte. Ltd

Associates

• 1. STT Global Data Centres India Private Limited
• 1. Smart ICT Services Private Limited
• 1. United Telecom Limited

Tata Communications continues to drive growth and profitability Delivers PAT of INR 309 Crore for Q3, up 428% YoY

Data services revenue grew by +3.8% YoY | Consolidated EBITDA at INR 1,046 Crore, increase of +37.5% YoY with margin expansion of 680 Bps

Mumbai – January 19th, 2021 -Tata Communications today announces its financial results for the quarter ended December 31st, 2020.

Highlights|Q3 FY2021

Consolidated financial highlights

• Consolidated revenue was at INR 4,223 crore (USD 572 Mn); flat YoY, growth in data business compensated for decrease in Voice business
• Consolidated EBITDA at INR 1,046 crore (USD 142 Mn); increase of +37.5% YoY on the back of robust growth and margin expansion in data business and cost optimisation initiatives
• Consolidated PAT at INR 309 crore (USD 42 Mn) as compared to a profit of INR 59 crore in Q3 FY20, growth of +428% YoY, on the back of strong growth in profitability
• Net Debt has come down on the back of strong free cash flow generation; Net Debt to EBITDA at 1.9x as compared to 2.9x for same quarter last year
• CAPEX for this quarter was INR 339 crore as compared to INR 490 crore in Q3 FY20

Data services portfolio

• Stable growth in Data business despite seasonally slow quarter; revenue grew by +3.8% YoY on the back of robust performance in Traditional services
• Data EBITDA was at INR 1,026 crore (USD 139 Mn); up +43.8% YoY led by strong growth in Traditional services and profitable gain in Growth services. Data business now contributes 98% to overall EBITDA
• Traditional services witnessed strong growth in revenue and profitability; revenue grew by +6% YoY and EBITDA grew by 20.7% YoY with margins at 42.9%. We are witnessing strong demand from OTT and Enterprise segment for our services.
• Growth services continue to scale and witness profitable growth; revenue grew by +2.6% YoY. We continue to witness operating leverage in this portfolio; EBITDA grew by +145.7% YoY with a margin expansion of 910 Bps

Consolidated Nos.	INR Crore	QoQ Growth	YoY Growth
Gross Revenue	4,223	(4.1%)	(0.1%)
EBITDA	1,046	(9.6%)	37.5%
EBITDA margin	24.8%	(150 Bps)	680 Bps
PAT	309	(19.6%)	428.2%

Announcing the results, A.S Lakshminarayanan, MD and CEO, Tata Communications, said, "Our disciplined execution has helped us deliver good results in a seasonally weak quarter. Our Secure Connected Digital Experience (SCDx) offering continues to be relevant as we reimagine the New World for our customers. At the same time, our investments in products and services are positioning us well in our customers' digital transformation journeys, an example being our investment in Oasis. I am happy to share that during the quarter, our efforts in Sustainability for Climate Change placed Tata Communications in the leadership band of the Carbon Disclosure Project (CDP) Report encouraging us to continue to make a difference to our Planet."

Commenting on the results, Kabir Ahmed Shakir, Chief Financial Officer, Tata Communications, said, "We continue to deliver on our goal of profitable growth. Both profitability and cash flow generation has improved significantly in the last few quarters on the back of cost efficiencies and improved business processes. This agility has given us headroom to compete more effectively in the market and cater to our customer's changing needs. Our focus continues to remain on generating a healthy order book coupled with strong execution to drive our growth."

An investor fact sheet providing detailed analysis of the results for the quarter ended December 31st, 2020 has been uploaded on the Tata Communications website and can be accessed here.

© 2021 Tata Communications Ltd. All rights reserved. TATA COMMUNICATIONS and TATA are trademarks of Tata Sons Limited in certain countries.

Business highlights | Q3 FY2021

Customer wins in Q3:

• ATP Media, the global sales, broadcast production and distribution arm of the ATP tour (a worldwide top-tier tennis tour for men organised by the Association of Tennis Professionals) has selected Tata Communications to deliver high quality viewing experience to global audiences by delivering live broadcast of ATP tournaments through our global end-to-end Video Connect network. We will facilitate superfast transfer of live content from on-site production, over to broadcasters, and onwards to the global tennis audience of ATP Media in over 200 broadcast territories. This will help ATP Media consolidate its production and broadcasting operations into one global network, making content distribution faster and more efficient. Our content delivery infrastructure will assist ATP Media enhance its broadcast production quality by introducing innovative technology, increasing camera angles, and cutting the delivery time to all markets, giving fans superior video quality, more viewing options, and customised insights into their favourite sport. We will enable live contribution and distribution of content from all ATP tournaments, including the 2021 ATP Masters 1000s, ATP Finals, ATP 500s and 250s. The 2020 St Petersburg Open which took place in October 2020, was also using our Video Connect network. Tata Communications will be responsible for production connectivity, distribution delivery models, on-site services, encoding and 24 hour monitoring and management. Our solution will ensure the resilience and security of the network, as well as provide the network equipment at all sites for reliable, long-distance media communication. We will also manage business continuity technology solutions for ATP through our low latency Video Connect platform.

Carolina Santos, Head of Broadcast, ATP Media said, "I am extremely pleased with our new partnership with Tata Communications. This represents a huge commitment for ATP Media, enabled only by Tata Communication's level of transparency, commitment and engagement throughout every step of the process. This has allowed us to shape together a new foundation to support ATP Media's production and distribution for years to come."

• MMD MOBILITY and IOT (MMD), a South African ICT services provider, will leverage Tata Communications' cloud-based, fully automated, and API-enabled Tata Communications MOVE™ MVNE platform to deliver high-quality, ubiquitous connectivity management for MVNOs and IoT service providers in Africa. MMD will provide fast connectivity and enhanced experience for MVNOs accessing and implementing voice, data, and SMS applications for its subscribers and, the enterprises for their IoT use cases, because of our platform's seamless integration with the leading regional mobile network operator in Africa. With Tata Communications MOVE™ mobility and IoT platform MMD will have the flexibility to attract new customers and generate additional revenue streams by introducing new services and extending its customers' geographical reach, without large upfront investments. This will help MMD enable its customers to capture, move and manage information securely and reliably across borders. MMD's customers across sectors like healthcare, consumer, transport, mining, agriculture, banking, and retail will also be able to buy mobile network access from MNOs in Africa on a pay-as-you-go basis by using our platform. Working with us will facilitate MMD to become the partner of choice for businesses and MVNOs that aim to introduce new solutions and ways to engage with their customers beyond SIM cards and / or boost operational efficiencies through these next-generation digital applications.
• One of the leading coal mining and refining companies of India, is having the unique advantage of consolidating its entire IT infra -- hosting, security, and network services under one vendor on Tata Communications IZOTM Private Cloud in Delhi. This will enable them to realise reduction in tech costs, ondemand hardware scalability and ensure business continuity with enhanced security. They will be

migrating their legacy on-premise ERP to SAP HANA certified platform on Tata Communications IZOTM Private Cloud, along with some non-SAP applications, resulting in a multi-cloud transformation. Our IZO Command portal will help their users seamlessly monitor and manage the multi-cloud computes. Over a period of time, the solution is expected to significantly upscale the number of users and the database size. In addition it will also help the customer optimise costs, address fluctuating and growing resource needs through on-demand IT infra scale-up and scale-down capabilities and a pay-per-use model. They will also be able to securely store, access and use data on Tata Communications' private cloud infrastructure which comes with a host of advanced security offerings, proactive control of server performance, utilisation, threat monitoring and tracking of service level compliance with our unique integrated dashboard. Furthermore, this will enable them to maintain seamless business continuity with a holistic Disaster Recovery (DR) set-up in Tata Communications Mumbai with a hundred percent data replication and resiliency spread across geographies in different seismic zones. Thus, Tata Communications will be able to evolve the hosting and security landscape along with delivering connectivity, making it an end-to-end technology transformation.

Awards: Best employer

• Tata Communications USA and Tata Communications Canada certified as Great Place to Work® . USA certified for the second year in a row and Canada third year in a row.

Awards: Analyst recognition

• Telecom Services 2020 Vendor Assessment: Leader in IDC MarketScape, Asia/Pacific Next– Generation Telcos
• Frost Radar™ Asia-Pacific Hosted IP Telephony and UCaaS Market, 2020: Leader
• The Forrester Wave™ SD-WAN Service: Strong Performer
• RadarView™: Innovators in Avasant SD-WAN Managed Services 2020
• Leader in GlobalData Global Wholesale IoT: Competitive Landscape Assessment

Awards: Industry recognition

• CX Asia Week: Best Customer Experience Award Category, Honorary mention
• NASSCOM DSCI Excellence Awards 2020: For Cyber Security Services under the category Cyber security evangelists
• Telecom Review Excellence Awards 2020: Most Innovative Adaptation Technology for Covid-19 - Operator
• Tata Communications was recognised by global environmental non-profit organisation, Carbon Disclosure Project (CDP) with the distinguished 'A-' leadership score for implementing current best practices in sustainability for climate change. Tata Communications score is higher than the global average of 'C' and higher than the Asia region average of 'D'.

Partnerships:

• Micron and Tata Communications: Micron and Tata Communications have joined forces to create a worldwide cellular-enabled connectivity solution that will simplify and accelerate largescale global deployment of internet of things (IoT) devices with the help of a new virtual eSIM enabled by Micron's Authenta™ Key Management Service (KMS). With the eSIM technology, the Tata Communications MOVE™ Global IoT Solution will offer end-to-end solution for zerotouch onboarding of connected IoT devices to cloud services across 200 countries and territories.

• Oasis and Tata Communications: Tata Communications acquired a major stake in Oasis Smart SIM Europe SAS, a French embedded-SIM (eSIM) technology provider. This investment will allow the eSIM technology to get fully integrated into the Tata Communications MOVETM platform, enabling an end-to-end embedded connectivity solution and strengthening Tata Communications MOVE TM as a single source platform for global enterprise mobility needs. Tata Communications will be driving and accelerating the product roadmap R&D while Oasis will leverage and amplify the growth in the mobility and IoT markets.

New Appointment:

• Tata Communications appointed Kabir Ahmed Shakir as Chief Financial Officer. Kabir joined on October 21st, 2020 and is responsible for the strategic financial management of the company, including investor relations.

ENDS…

Media Contact: Investor Contact: Arati Mukerji Tata Communications +91 9958895759 arati.mukerji@tatacommunications.com

Vipul Garg Tata Communications +91 11 66257431 vipul.garg@tatacommunications.com

About Tata Communications

Tata Communications is a digital ecosystem enabler that powers today's fast-growing digital economy.

The company enables the digital transformation of enterprises globally, including 300 of the Fortune 500 – unlocking opportunities for businesses by enabling borderless growth, boosting product innovation and customer experience, improving productivity and efficiency, building agility and managing risk.

With its solutions orientated approach and proven managed service capabilities and cutting-edge infrastructure, Tata Communications drives the next level of intelligence powered by cloud, mobility, Internet of Things (IoT), collaboration, security, and network services.

Tata Communications carries around 30% of the world's internet routes and connects businesses to 60% of the world's cloud giants and 4 out of 5 mobile subscribers.

The company's capabilities are underpinned by its global network, the world's largest wholly owned subsea fibre backbone and a Tier-1 IP network with connectivity to more than 200 countries and territories.

Tata Communications Limited is listed on the Bombay Stock Exchange and the National Stock Exchange of India. www.tatacommunications.com

Forward-looking and cautionary statements

Certain words and statements in this release concerning Tata Communications and its prospects, and other statements, including those relating to Tata Communications' expected financial position, business strategy, the future development of Tata Communications' operations, and the general economy in India, are forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors, including financial, regulatory and environmental, as well as those relating to industry growth and trend projections, which may cause actual results, performance or achievements of Tata Communications, or industry results, to differ materially from those expressed or implied by such forward-looking statements. The important factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements include, among others, failure to increase the volume of traffic on Tata Communications' network; failure to develop new products and services that meet customer demands and generate acceptable margins; failure to successfully complete commercial testing of new technology and information systems to support new products and services, including voice transmission services; failure to stabilize or reduce the rate of price compression on certain of the company's communications services; failure to integrate strategic acquisitions and changes in government policies or regulations of India and, in particular, changes relating to the administration of Tata Communications' industry; and, in general, the economic, business and credit conditions in India. Additional factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements, many of which are not in Tata Communications' control, include, but are not limited to, those risk factors discussed in Tata Communications Limited's Annual Reports. The Annual Reports of Tata Communications Limited are available at www.tatacommunications.com. Tata Communications is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements.

© 2021 Tata Communications Ltd. All rights reserved. TATA COMMUNICATIONS and TATA are trademarks of Tata Sons Limited in certain countries.