Hfcl Limited · NSE:HFCL
Hfcl — Investor Presentation (December 2019)
48 slides from Hfcl's investor presentation, Dec 3, 2019
Slide 1: Intimation of Schedule of Investors' Meetings
HFCL Limited ©M•i1111► - ~ HFC~ GROUP @U{•iit•1•1► An Environment conscious company certified to (formerly Himachal Futuristic Communications Ltd.) 8, Commercial Complex, Masjid Moth , Greater Kailash -11, New Delhi -110048, India Tel. Fax : (+91 11) 3088 2624, 3088 2626 : (+9111) 3068 9013 Web : ww
Slide 2: HFCL Limited Investor Presentation December 2019
HFCL LIMITED INVESTOR PRESENTATION DECEMBER 2019
Slide 3: Company Overview
COMPANY OVERVIEW 2
Slide 4: Company Overview
Company Overview • HFCL Limited (formerly known as Himachal Futuristic Communications Limited) is an established leader offering State-of-the-art Manufacturing Facilities fully integrated communication network solutions. • OFC manufacturing at Verna, Goa & through subsidiary • Manufactures optical f
Slide 5: Board Of Directors
Board Of Directors Mahendra Pratap Shukla - (Non-Executive Chairman) Ranjeet Anand Kumar Soni (Non-Executive Director -(Nominee • An Electrical Engineer with vast experience in Telecom Industry – IDBI) • Ex-Chairman & MD of TCIL & MTNL • Masters In Mathematics & JAIIB Certification From Indian • Awa
Slide 6: Leadership Team
Leadership Team Board of Directors Managing Director Mahendra Nahata SBU Heads Business & Technology Heads Functional Heads Jitendra Chaudhary Ashwani Gupta V. R. Jain Telecom Executive Director Finance Col. B. B. Singh S. K. Garg Shiv Kumar Singh Vibhas Joshi Defence Comm. Services Technology Suppl
Slide 7: Key Milestones
Key Milestones Set up : -Railways Communication, Smart City, Defence Setup Turnkey communication as Wireline Division new business Launch of Manufacturing Forayed into verticals. Wireless Facility providing fully Network Set up at Solan, integrated -Defence equipment Connectivity Himachal network Ca
Slide 8: Manufacturing Facilities
Manufacturing Facilities OFC Manufacturing Verna, Goa Capacity: 8m fkm Telecom Equipment Manufacturing Solan, Himachal Pradesh OFC Manufacturing Chennai, Tamil Nadu Capacity: 10.5m fkm FRP Rods, IFGR, ARP Manufacturing Hosur, Tamil Nadu Capacity: FRP Thermal - UV 7,66,800 kms /IGFR - 22.50 MT/ARP 1,
Slide 9: Research & Development Capabilities
Research & Development Capabilities Strategy • R&D initiatives in house and in partnership with others • Develop products which can be sold globally and can be bench marked with other leading global manufacturers Team • Over 100 people with proven track record, International experience and Indian bu
Slide 10: Key Customers
Key Customers TELECOM NOKIA a BTe | IndianOil orange e 4 TeiLlh Gout, of India Enterprise crazies t Ministry of Interior BSB) iingoom of saudi arabia — . enrol CB —_—— Fy eu psstraagaut asa \O Saudi Electricity Company oorecoo Mairtel © od ANATEL vodafone (>) HERR AA Se CHINA RAILWAY STC a> geuill G
Slide 11: Customer Presence
Customer Presence EUROPE • Germany AMERICAS ASIA • Singapore • UAE • Uganda • Ireland • Hungary • Brazil • Bangladesh • Sri Lanka • Saudi Arabia • Zimbabwe • Bosnia and • Poland • Canada • Bhutan • Iran • Somalia Herzegovina • UK • Mexico • Burma • Kuwait • Latvia • Italy • Peru (Myanmar) • Cyprus A
Slide 12: Products and Solutions Portfolio
PRODUCTS AND SOLUTIONS PORTFOLIO 11
Slide 13: Portfolio of Products
Portfolio of Products OPTICAL FIBER CABLES TELECOM PRODUCTS SURVEILLANCE PRODUCTS DEFENCE PRODUCTS • Aerial Cables • Microwave Radios • Video Management System UNDER FIELD TRIAL • Armoured / Unarmoured • Telecom Power Systems • Video Analytics • Unmanned Aerial Cables • High Capacity Radio Relay • A
Slide 14: Optical Fiber Cables
Optical Fiber Cables Conventional cables • Armoured Cable • Aerial Cables- ADSS and Figure-8 • Ribbon Cables FTTH Cable Applications • Indoor/Outdoor cables • Micro-duct / Mini-cables / Air Blown Cables Long Distance Network • FTTH Cables • In-Premises Cables Intra-city Network FTTH Network Specialt
Slide 15: Telecom Products
Telecom Products Microwave Radio Equipment Unlicensed Band Radio Integrated high bandwidth radio unit with centralized network Provide high speed point-to-point management and point-to multi-point connectivity solution in unlicensed ISM bands. GSM BSS Equipment Telecom Power Solution Small Size GSM
Slide 16: Surveillance Products
Surveillance Products VMS Video Management System • Focused on Smart City Solutions, City Surveillance, Traffic Enforcement, Critical PMS Infrastructure Protection, Parking Management VA System Video Analytics Industrial & Government Projects • Company believes in developing HTMS ANPR Innovative Sol
Slide 17: Defence Products
Defence Products The nascent steps that HFCL started taking in Defence manufacturing a couple of years ago, under the ‘Make in Electro Optical Devices (Night Unmanned Aerial Vehicles Electronic Fuses for all types India’ initiative, have Vision Devices) (UAVs) of ammunition been growing steadily in
Slide 18: Portfolio of Network Solutions
Portfolio of Network Solutions DEFENCE NETWORK RAILWAY COMMUNICATION & SMART CITY & SURVEILLANCE TELECOM NETWORK SIGNALING NETWORK NETWORK (Metro Rail & Main Line ) • OFC Network • OFC Network • Safe City Solutions • Network & Equipment • FTTx Network Design • Intelligent Traffic • Optical Transport
Slide 19: Telecom Network Solutions
Telecom Network Solutions OFC Network • OFC Survey & Network Design • fiber Deployment • Site and Infrastructure Built-up WIFI : Providing complete eco system • Installation & commissioning for WIFI services • Operations & Maintenance • Design and Implementation of WIFI solutions • Offering entire r
Slide 20: Defence Network Solutions
Defence Network Solutions Fiber Network Rollout of dedicated optical fiber network for armed forces Optical Transport Network IPMPLS Network (Routing & Switching) Rollout of exclusive and dedicated Nationwide Converged Nationwide IP/MPLS Backbone Network with 219 DWDM based Optical Transmission back
Slide 21: Railway Communication Network Solutions
Railway Communication Network Solutions • In order to leverage its telecom product and EPC capabilities in adjacent space, Company has ventured into railways business • HFCL offers integrated solutions crafting a combination of its own products and those others from leading manufacturing OEM partner
Slide 22: Smart City & Surveillance Solutions
Smart City & Surveillance Solutions Projects executed HFCL’s offerings in the Safe & Smart city domain include key core solutions like Communication / IT / Telecom infrastructure, data centre, disaster recovery and Ludhiana Safe City management, security, surveillance, traffic management and citizen
Slide 23: Financial Overview
FINANCIAL OVERVIEW 22
Slide 24: Key Highlights – Consolidated Financials – FY19
Key Highlights – Consolidated Financials –FY19 Debt /Equity is Completely EBITDA CAGR of now comfortable Transformed 46% from FY17 to at 0.41x on Growth FY19 PAT up Trajectory from INR 1,237 Mn Debt is largely EBITDA at in FY17 to Working INR 4,582 Mn INR 2,323 Mn in FY19 Capital 37% CAGR Credit rat
Slide 25: H1-FY20 Financial Highlights - Consolidated
H1-FY20 Financial Highlights - Consolidated H1-FY20 Financial Highlights (Consolidated): H1-FY19 Financial Highlights (Consolidated): Total Total EBITDA EBITDA EBIDTA EBIDTA Income Income INR 3,359 Margins INR 1,914 Margins INR 23,306 INR 23,095 Mn 14.46% Mn 8.32% Mn Mn PAT PAT Diluted PAT PAT Dilut
Slide 26: H1-FY20 Financial Highlights - Standalone
H1-FY20 Financial Highlights - Standalone H1-FY20 Financial Highlights (Standalone): H1-FY19 Financial Highlights (Standalone): Total Total EBITDA EBIDTA EBITDA EBIDTA Income Income INR 2,947 Margins INR 1,719 Margins INR 21,304 INR 21,745 Mn 13.88% Mn 7.93 % Mn Mn PAT PAT Diluted PAT PAT Diluted IN
Slide 27: H1-FY20 Performance Metrics – Consolidated
H1-FY20 Performance Metrics – Consolidated Income & Margin 0.44 Debt and Equity 16,137 0.50 47,805 20.0% 14,417 14.5% 12,391 0.40 15.0% 0.41 0.41 32,730 10,446 0.30 9.7% 9.7% 23,306 0.33 9.5% 10.0% 22,243 6,579 0.20 5,903 7.9% 5.0% 4,582 4,083 0.10 5.6% 5.3% 4.9% 0.0% - FY17 FY18 FY19 H1-FY20 FY17 F
Slide 28: Strong Order Book of ~INR 9,410 Cr provides visibility
Strong Order Book of ~INR 9,410 Cr provides visibility Total Order book of ~INR 9,410 Cr as on 30 Sept, 2019 Order Book To Revenue (INR Cr) 11,350 • Prestigious orders 8,700 9,410 spread across all business verticals- telecom, defence, 4,738 railways, OFC Turnkey & 3,249 3,000 manufacturing, Smart 2
Slide 29: H1-FY20 Consolidated Income Statement (IND-AS)
H1-FY20 Consolidated Income Statement (IND-AS) PARTICULARS (INR Mn) H1-FY20 H1-FY19 Y-o-Y Revenue from Operations 23,222 23,015 0.9% Other Income 84 80 5.0% Total Income 23,306 23,095 0.9% Total Expenses 19,948 21,181 (5.8)% EBITDA 3,359 1,914 75.5% EBITDA Margin (%) 14.46% 8.32% 614 Bps Depreciatio
Slide 30: H1-FY20 Standalone Income Statement (IND-AS)
H1-FY20 Standalone Income Statement (IND-AS) PARTICULARS (INR Mn) H1-FY20 H1-FY19 Y-o-Y Revenue from Operations 21,237 21,678 (2.0)% Other Income 67 67 - Total Income 21,304 21,745 (2.0)% Total Expenses 18,357 20,026 (8.3)% EBITDA 2,947 1,719 71.4% EBITDA Margin (%) 13.88% 7.93% 595 Bps Depreciation
Slide 31: Historical Income Statement (IND-AS)
Historical Income Statement (IND-AS) STANDALONE CONSOLIDATED PARTICULARS (INR Mn) FY17 FY18 FY19 FY17 FY18 FY19 Revenue from Operations 20,668 30,802 43,662 22,029 32,485 47,378 Other Income 186 183 458 214 245 427 Total Income 20,854 30,985 44,120 22,243 32,730 47,805 Total Expenses 18,860 28,159 4
Slide 32: Historical Consolidated Balance Sheet
Historical Consolidated Balance Sheet EQUITIES & LIABILITIES (INR Mn) FY18 FY19 H1-FY20 ASSETS (INR Mn) FY18 FY19 H1-FY20 (A) Share Capital 1,239 1,274 1,284 (A) Property plant & Equipment 1,657 2,022 2,252 (B) Other Equity 10,548 13,143 14,853 (B) Capital Work in Progress 17 640 2031 (C) Goodwill 2
Slide 33: Historical Standalone Balance Sheet
Historical Standalone Balance Sheet EQUITIES & LIABILITIES (INR Mn) FY18 FY19 H1-FY20 ASSETS (INR Mn) FY18 FY19 H1-FY20 (A) Share Capital 1,239 1,274 1,284 (A) Property plant & Equipment 1,074 1,076 1,316 (B) Other Equity 10,921 13,162 14,642 (B) Capital Work in Progress 14 622 1793 (C) Other Intang
Slide 34: Industry Overview
INDUSTRY OVERVIEW 33
Slide 35: Telecom - Mature Eco-system is Driving Growth
Telecom - Mature Eco-system is Driving Growth Growing Internet Community • Internet Subscribers grew at CAGR of 25% (2013-18) 604 Mn in Dec 2018 • Broadband Subscribers stand at 525 Mn in Dec 2018 at CAGR of 85% (2013-18) Data Consumption Pattern • Total Data usage per month grew ~40 times in last t
Slide 36: Telecom - Industry Growth
Telecom - Industry Growth Internet Subscribers (Mn) 3G/4G device base (Mn) 900 530 432 604 379 494 310 335 422 343 218 128 47 Mar-16 Mar-17 Mar-18 Dec-18 Dec -22 2015 2016 2017 2018 3G 4G Internet Traffic Per month (Exabyte) Internet Speed (Mbps) 31.2 15.5 9.5 2.1 5.1 6.6 0.9 1.2 2015 2016 2017 2022
Slide 37: Telecom - Data Consumption To Leap Frog
Telecom - Data Consumption To Leap Frog Data Usage Per Month, Pentabyte (Pb) Per Subs Data Usage / Price per GB (INR) 4,867 226.0 9.43 4,472 2,360 5.59 966 76.0 128 1,930 398 395 0.79 19.0 82 823 2.69 11.0 103 32 46 40 2015 0 2016 2017 2018 2015 2016 2017 2018 2G 3G 4G Total Data Usage per Month (Mb
Slide 38: Telecom - National Digital Communications Policy, 2018
Telecom - National Digital Communications Policy, 2018 Target 2022 Connect India: Fixed By Creating a Robust Digital Communication Infrastructure 25 Mbps Broadband 50 Mbps • Provide Universal broadband connectivity at 50 Mbps to every citizen • Provide 1 Gbps connectivity to all Gram Panchayats of I
Slide 39: Telecom Opportunity
Telecom Opportunity 4G,5G • 4G is the key driver behind increasing users’ appetite towards data consumption. Aggressive 4G expansion is capturing 92% share of total data traffic • Only 20-25 per cent of sites in India are fiberized, a number that needs to go up to 80-85 per cent by 2022 to support 5
Slide 40: Defence Opportunity
Defence Opportunity • India is the largest importer of defence equipment in the world where the imports account for nearly 65% of the country’s military requirement. • India has spent USD 100 Bn in last one decade to buy 65 per cent of its defence equipment therefore, the government has set a goal t
Slide 41: Railways Opportunity
Railways Opportunity • India is one of the largest rail networks in the world and is expanding like never before with FY18 revenues at USD 27.71 Bn (CAGR of ~10% during FY07-FY18) • Legacy Signaling and Telecom Systems are integral parts of Railways and need an overhaul and upgradation to strengthen
Slide 42: Smart Cities & Surveillance Opportunity
Smart Cities & Surveillance Opportunity Role of ICT in Smart City • Hundred cities have been selected under Smart Cities Project at an outlay of over Intelligent and INR 2 lakh Cr efficient Cost and energy use of savings Planning resources • High speed Communication technology of ICT shall play a ke
Slide 43: Massive USD 100 Bn+ Industry Opportunities
Massive USD 100 Bn+ Industry Opportunities GoI’s push in Huge Fiberizing fast-tracking its Smart City Infrastructure 70% of the towers FTTH shall play a mission is yielding results expenditure will require an estimated with SPVs getting formed significant role in is underway in India 600,000 fkm, at
Slide 44: Status of Shares Pledged by Promoters
Status of Shares Pledged by Promoters Promoters’ holding is pledged with the Company’s Banks for the credit facilities as collateral (No loans have been taken against Shares): • 49% of Promoters’ Holding stands pledged with group of Lenders out of which : • 75% is towards outstanding Working Capital
Slide 45: Value Proposition
Value Proposition Agile Portfolio of Products and Solutions Leadership Agile portfolio of products and solutions backed by excellent Established leader in providing fully integrated solutions in building manufacturing facilities Communication Networks for Telecom, Defence, Railways and other sectors
Slide 46: Capital Market Information
Capital Market Information 30% 25% 20% 15% 10% 5% 0% -5% -10% -15% Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 HFCL SENSEX Shareholding - (As on 30th September, 2019) PRICE DATA (AS ON 30th September, 2019) FIIs DIIs Face value (INR) 1.0 5% 2% Market Price (IN
Slide 47: Glossary
Glossary ADSS : All-Dielectric Self-Supporting ANPR : Automatic Number Plate Recognition ARP : Aramid Reinforcement Plastic CCTV : Closed Circuit Television CMS : Challan management System CPRI : Common Public radio Interface DWDM : Dense Wave Digital Multiplexing EBIDTA : Earing before Depreciation
Slide 48: Disclaimer
Disclaimer HFCL Limited (formerly Himachal Futuristic Communications Limited) No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained in this presentation. Such