Slide 1: Cover letter to stock exchanges: Earnings Presentation
HFCL/SEC/23-24 May 08, 2023 The BSE Ltd. The National Stock Exchange of India Ltd. 1st Floor, New Trading Wing, Rotunda Building Exchange Plaza, 5th Floor, C – 1, Block G Phiroze Jeejeebhoy Towers, Dalal Street, Fort Bandra – Kurla Complex, Bandra (E) Mumbai – 400001 Mumbai – 400051 corp.relations@b
Slide 2: Investor Presentation March 2023
MAR 2023 Investor /////////////////////////////////////////////////////////// Presentation ////////////////////////////////////////////////////// HFCL LIMITED
Slide 3: Contents
CONTENTS HFCL at a Glance Strategic Priorities and Market Opportunities Competitive Social Advantage Governance Financials Appendix
Slide 4: HFCL at a glance
HFCL at a glance Presence in Key Industries Product Offerings Network Solution Offerings Manufacturing Facilities across India Few Achievements 01
Slide 5: HFCL – Presence in Key Industries
HFCL – Presence in Key Industries Telecom and Cable Defence Railways 83% Revenue Contribution 15% Revenue Contribution 02% Revenue Contribution One of the largest manufacturer and supplier of OFC in India One of the largest Defence Network Leveraging our capabilities of next- Rolling out backbon
Slide 6: Product Offerings
Product Offerings Optic Fiber/ Telecommu- Passive Defence Products Under Development Optical nication Connectivity Electronics Fibers Cables Products Solutions Products Telecommunication • 5G Indoor & Outdoor FWA CPE • 5G Radio Access Network Products (8T8R) 1 2 1 2 • 5G Indoor & Outdoor Small Cell
Slide 7: Network Solution Offerings
Network Solution Offerings Public Defence Communication Railways Communication Telecommunication Optical Fiber Cable and Fiber Monitoring & Optical Transport Network Management System Deployment of comprehensive solutions for building of wireless and optical telecommunications networks including Opt
Slide 8: Manufacturing Facilities across India
Manufacturing Facilities across India 1 2 3 5 Manufacturing facilities across India HYDERABAD, TELANGANA 2 facilities CHENNAI, TAMIL NADU • 5.2 mn fkm/annum Optic Fiber Cables (Through subsidiary company HTL Ltd) • 432k cable km/annum FTTH Cables • 11.88 mn fkm/annum Optic Fiber Cables • 10 mn fkm/a
Slide 9: Few Achievements
Few Achievements Telecom Equipment • Supplied more than 3.5 lacs units of own designed and developed back haul radios to various TSPs • Created technology partnership with Qualcomm for developing 5G RAN and Access products • Entered into partnership with Microsoft to create “ Enterprise 5G networks”
Slide 10: Few Achievements
Few Achievements Network Implementation • Implementing prestigious ultra high bandwidth fibre optic communication network for Indian army and Indian Air force • Implementing FTTH network in 200+ cities across North India • Started execution of Rs.1700 crs water pipeline project in the state of Uttar
Slide 11: Few Achievements
Few Achievements Railway Communication • Successfully implemented telecom network of Mauritius Metro Phase 1 • Successfully implemented telecom network of Dhaka Metro Phase 1 ; Phase 2 in progress • Received order for implementing telecom network of Kanpur & Agra Metro • Received order for implement
Slide 12: Strategic Priorities & Market Opportunities
Strategic Priorities & Market Opportunities The Way Forward Strategic Priorities Strategic Growth Drivers Key Partnerships / Customers Market Opportunities Growth Opportunity Landscape HFCL as a Global Provider Domestic Opportunity Landscape Domestic Defence Market Opportunities Domestic Railway Mar
Slide 13: The Way Forward
The Way Forward Expanding Product Increased Portfolio Manufacturing Capabilities and high-level backward Poised to integration Win Expanding Global Expanding Reach Customer Base HFCL Limited | Investor Presentation Mar 2023 12
Slide 14: Strategic Priorities: Expanding Product Portfolio
Strategic Priorities Expanding Product Portfolio Significant investments for new Fresh initiatives to develop new Development of software-defined product developments including types of optical Fiber cables for radios, thermal weapon sights and Wi-Fi-7 enabled access points, ultra export markets, al
Slide 15: Strategic Priorities: Expanding Global Reach
Strategic Priorities Expanding Global Reach Exports constitute 17.23 % of total Established two new wholly-owned Focused on new geographies, Became first Indian company to revenue in FY23 and has grown at a subsidiaries in the Texas (USA) and especially Europe, North America offer TIP OpenWiFi based
Slide 16: Strategic Priorities: Increasing Manufacturing Capabilities
Strategic Priorities Increasing Manufacturing Capabilities Setting up of new facility in NCR Expanding manufacturing capacity of Optical OFC capacity expansion to 35 mn fkm p.a. from region for the manufacture of Fiber to 25 mn fkm p.a. from 10 mn fkm p.a. 25 mn fkm p.a. Telecom and Networking produ
Slide 17: Expansion of Optical Fiber Capacities
Expansion of Optical Fiber Capacities Optical Fibre Capacity to increase by 2.5x Further strengthening 25 of backward integration Reduce dependence on external suppliers for 10 manufacturing of Optical Fiber Cables Higher Quality Assurance of finished goods Current Capacity Proposed Capacity Yield b
Slide 18: Expansion of OFC Capacities
Expansion of OFC Capacities Optical Fibre Cable Capacity to increase by ~10 fkm 35 25 Current Capacity Proposed Capacity (mn fkm) (mn fkm) • OFC capacity to reach 35mn fkm by FY25 to meet and cater the growing demand globally • New capacity to strengthen product portfolio and geographical expansion
Slide 19: Telecom & Networking Products: 5G and other Networks
Telecom & Networking Products : 5G and other Networks 5G & Telecom Products Expected timeline of Products commercial launch 1. 2Gbps Point to Point and Point Q2FY24 to Multipoint UBR 1 2. 5G Transport – Cell site Routers 3. 5G RAN – Outdoor FWA CPE Q3FY24 4. 5G RAN – Indoor small cells (2T2R Indoor)
Slide 20: Strategic Growth Drivers: Intensifying R&D efforts
Strategic Growth Drivers Intensifying R&D efforts Establishment of 3 R&D centers in Bengaluru, Investing in technology creation, research and Investing in development of various use cases for Gurugram and Hyderabad. Focus areas include creating new industry standards, and strong taking advantage of
Slide 21: Strategic Growth Drivers: Shift in Revenue Mix
Strategic Growth Drivers Shift in Revenue Mix Shift from Project-led revenue to Product-led Increased business from Private Entities in Increased focus on Export-led revenue revenue - Increase in product revenue will alignment with market demand generation by leveraging on global demand facilitate l
Slide 22: Key R&D Partnerships
Key R&D Partnerships Licensing for Open Partnership for 5G Partnership for 5G Small Partnership for 5G Small Design partner for Partnership for Switches source Wi-Fi 7 products ; Transport Products Cells Cells Macro Radio, Wifi 5G millimeter wave FWA ; Access points, UBRs, product development; Cloud
Slide 23: Key Customers
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Slide 24: Opportunity Landscape
Opportunity Landscape How do We Plan Global Growth Landscape to Grow? Domestic Growth Landscape HFCL Limited | Investor Presentation Mar 2023 23
Slide 25: Growth Opportunity Landscape – Global (1/2)
Growth Opportunity Landscape – Global (1/2) Germany – BMVI Nationwide Gigabit Plan EUR 43 billion allocated for Fiber broadband deployments in Germany through 2025 to increase Fiber coverage from 5.4% of households to 17.7%. Of the total capital, EUR 12bn Germany– Broadband allocation EUR 43 bn comm
Slide 26: Growth Opportunity Landscape – Global (2/2)
Growth Opportunity Landscape – Global (2/2) USA Under the Broadband Equity, Access and Deployment (BEAD) program, US government has allocated USD 42.5 bn to support states expand the high-speed broadband service network. Additional USA– Broadband allocation USA USD 68 bn USD 25 bn committed under th
Slide 27: Growth Opportunity Landscape – Global – 5G and Telecom Equipment
Growth Opportunity Landscape – Global – 5G and Telecom Equipment Addressable product Portfolio under segment development Cell Site Router 5G Transport products DU (Distributed Unit) Aggregation Routers CU (Centralized Unit) Aggregation Routers 5G 8T8R RAN 5G RAN products 5G 2T2R/4T4R Indoo
Slide 28: HFCL as a Global Provider
HFCL as a Global Provider Our Global presence Exports Revenue Share (IN %) FY23 17.23 FY22 7.62 FY21 4.54 FY20 3.19 Large Distribution contracts across EU, Middle East, Africa Operations in 30+ countries and 80+ clients globally Meta (Facebook) recognized HFCL’s value in Well established and
Slide 29: Domestic Opportunity Landscape
Domestic Opportunity Landscape Addressable product Growth Driver Cumulative TAM (FY23-28) segment OF / OFC and Accessories Govt.funded optical network projects Expansion of FTTH network provided by TSPs Creation and expansion of 5G / 4G Network ~USD 9.6 Bn 12.6 Bn Creation and expansion of 5
Slide 30: Domestic Defence Market Opportunities
Domestic Defence Market Opportunities Cumulative TAM (FY23-28) Opportunity Growth Driver ~USD 2.1 Bn Electronic fuses Government Budget Initiative 20 Bn Efforts to Modernize Indian defence networks and systems Import reduction from 65% to 30% by FY32 on and provide a boost to local the back of i
Slide 31: Domestic Railway Market Opportunities
Domestic Railway Market Opportunities Projects Available* Growth Drivers & Cumulative TAM Overall Project Costs* (FY23-28)* Dedicated Freight Corridors – Greenfield projects with 3 projects in DPR stage Projects with capital cost of construction of USD 24.4 bn in the DPR stage USD 0.7 Bn Modernisati
Slide 32: Competitive Advantage
Competitive Advantage Why is HFCL Preferred ? 03
Slide 33: Why is HFCL Preferred?
Why is HFCL Preferred? Market Leader long term customer In-House R&D Integrated End to End relationship Manufacturing Network Provider Leadership in Optical Fiber Partner for Reliance Jio in Tech centric R&D driven Proven capabilities under Production in India company Optical Fiber Cable Nor
Slide 34: Social Governance
Social Governance ESG CSR 04
Slide 35: ESG as a Prime Directive
ESG as a Prime Directive Sustainable Packaging Reduced Energy Consumption Utilization of corrugated paper sheet instead of plastic during the process of packaging and reengineering Save between 88-126 kWh energy per month per site of packaging drums to save wood and fuel Replacement of convent
Slide 36: CSR: Giving Back to Society
CSR: Giving Back to Society Education Initiatives PROJECT SAMARTH: Healthcare Aid Adopted 46 specially-abled children and providing grants for their education. Running 8 Mobile Medical Clinics at different Education & prevention of malnutrition amongst street children locations for providing
Slide 37: Financials
Financials Q4FY23 Key Highlights - Consolidated Q4FY23 Consolidated Income Statement FY23 Key Highlights - Consolidated FY23 Consolidated Income Statement FY23 Balance Sheet Diversified Revenue Streams 05
Slide 38: Q4FY23 Key Highlights - Consolidated
Q4FY23 Key Highlights - Consolidated Collaborated with Microsoft to create converged private 5G solutions. Bagged an order worth ~₹282.61 crores Total (₹ IN CRORES) EBITDA (₹ IN CRORES PAT (₹ IN CRORES Diluted EPS (IN ₹) from Gujarat Metro Rail Corporation for Revenue & Margin & %) & Margin & %)
Slide 39: Q4FY23 Consolidated Income Statement
Q4FY23 Consolidated Income Statement Particulars ( ₹ I N C R O R E S ) Q4-FY23 Q3-FY23 Change Q-o-Q Q4-FY22 Change Y-o-Y Revenue from Operations 1433 1086 31.97% 1183 21.13% Other Income 14 6 30 Total Income 1447 1092 32.46% 1213 19.31% Total Expenses 1279 898 1059 EBITDA 168 194 -13.01% 154 9.43% E
Slide 40: FY23 Key Highlights - Consolidated
FY23 Key Highlights - Consolidated Committed an investment of ₹ 425 crore in PLI scheme and will avail an incentive up to ₹ 652.79 crores over a period of 4-5 years Total Revenue (₹ IN CRORES) EBITDA & Margin (₹ IN CRORES & %) PAT & Margin (₹ IN CRORES & %) Bagged Contract from State Water & 4,7
Slide 41: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars ( ₹ I N C R O R E S ) FY21 FY22 FY23 Revenue from Operations 4,423 4,727 4,743 Other Income 35 43 47 Total Income 4,458 4,770 4,790 Total Expenses 3,873 4,077 4,125 EBITDA 585 692 665 EBITDA Margin (%) 13.21% 14.66% 14.04% Depreciation 69 78 83 Financ
Slide 42: Consolidated Balance Sheet
Consolidated Balance Sheet Equities & Liabilities ( ₹ I N C R O R E S ) FY21 FY22 FY23 Total -Shareholder Funds 1,923 2,818 3,144 NON CURRENT LIABILITIES Debt-Equity Ratio (IN X) Dividend (IN %) (A) Financial Liabilities (i) Borrowings 251 121 110 (ii) Other Liabilities 55 19 6 FY23 0.24 FY23 20% (B
Slide 43: Diversified Revenue Streams
Diversified Revenue Streams Exports Revenue Share (IN %) Revenue Share by Type (IN %) of Customers 17.23 59 51 68 83 7.62 4.54 3.19 41 49 32 17 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 Government Private HFCL Limited | Investor Presentation Mar 2023 42
Slide 44: Appendix
Appendix Management Team Board of Directors Shareholders’ Information Abbreviations / Description 06
Slide 45: Led by an Experienced Management Team (1/2)
Led by an Experienced Management Team (1/2) S.K. GARG V.R. JAIN JITENDRA CHAUDHARY HARSH PAGAY Executive Director (Growth Strategy) Group Chief Financial Officer Executive President (Communications) Executive President (OFC) DR. PETER WEIMANN RAJESH JAIN COL B.B. SINGH Jayanta Dey Chief Technology O
Slide 46: Led by an Experienced Management Team (2/2)
DEVENDER KUMAR JOCHEN ARMS SANJAY JORAPUR at vP Executive Fr (DACH, Eu President - (Human Resources) ROB GILBERT try Manager [OFC Sales) - UK a MANOJ BAID. svP (Ci & Company S HFCL Limited 1
Slide 47: Governed by an Experienced Board
01 02 Governed by an Experienced Board 01 MAHENDRA NAHATA Promoter and Managing Director 03 04 05 02 AJAI KUMAR Independent Director 03 BHARAT PAL SINGH Independent Director 04 SURENDRA SINGH SIROHI Independent Director 06 07 05 DR TAMALI SEN GUPTA Independent Director 06 ARVIND KHARABANDA Non-Execu
Slide 48: Shareholders’ Information
Shareholders’ Information Share Information HFCL in Numbers (AS O N M a r c h 3 1 , 2 0 2 3 ) 51.56% 39.24% NSE Ticker HFCL BSE Ticker 500183 Others Promoters Market Cap (₹ Crores) 8,405.70 % free-float 82.47% Free-float market cap (₹ Crores) 6,932.18 Shares Outstanding 1,37,77,58,321 3M ADTV (Share
Slide 49: Abbreviations / Description
Abbreviations / Description Abbreviation Description Abbreviation Description 3GPP 3rd Generation Partnership Project O&M Operating & Maintenance ARP Aramid Reinforced Plastic OFC Optic Fiber Cable ATO Automatic Train Operation Order Book Order book comprises anticipated revenues from the unexecuted
Slide 50: Thank you
Thank you /////////////////////////////////////////////////////////// Corporate Office Amit Agarwal 8, Commercial Complex, HEAD – INVESTOR RELATIONS Masjid Moth, HFCL Limited Greater Kailash Part 2, Tel: +91-11-3520 9400 New Delhi, Delhi - 110048 Email: ir@hfcl.com //////////////////////////////////
Slide 51: Disclaimer
Disclaimer This presentation (“Presentation”) does not constitute a prospectus, offering memorandum or an offer, or a solicitation of any offer, to purchase or sell any securities. This presentation should not be considered as a recommendation that any investor should subscribe to or purchase any se