Sterlite Technologies Limited · NSE:STLTECH
Sterlite Technologies — Q2 FY2018 Earnings Presentation
28 slides from Sterlite Technologies's earnings presentation, Oct 16, 2017
Slide 1: Earnings Call Presentation
Earnings Call Presentation Oct 16, 2017 1
Slide 2: Disclaimer
Disclaimer Certain words and statements in this communication concerning Sterlite Technologies Limited (“the Company”) and its prospects, and other statements relating to the Company’s expected financial position, business strategy, the future development of the Company’s operations and the general
Slide 3: Industry Trends and Outlook
Industry Trends and Outlook 3
Slide 4: The Zettabyte Era: A Reality Now
The Zettabyte Era: A Reality Now Global IP traffic in Zettabytes (Actual & Forecasted) 3.34 2.74 +26% 2.23 1.81 1.46 Perpetual Growth in 1.06 0.87 Demand for Data & 0.60 0.72 Demand Drivers 0.34 0.46 Data growth driving new-age Rise in new-age tech trends tech trends & growth in and connected device
Slide 5: Exponential Growth in Data Consumption to Continue
Exponential Growth in Data Consumption to Continue Internet Users (Bn) Device Installed Base (Bn) Average Data per Consumer (GB/month) 4.6 26.3 3.7 16.3 8.9 2.4 4.0 1.9 0.4 2012 2016 2020 E 2012 2016 2020 E 2012 2016 2020 E Sources: www.internetworldstats.com, statista ; Cisco, Gemalto ; BGR, Cisco,
Slide 6: Fiber – Most Suited Media for Data Transmission
Fiber – Most Suited Media for Data Transmission 5G & FTTH Era: 4G & FTTx Era: Fiber to small Fiber cells, buildings & 3G Era: homes connectivity Fiber between connecting Towers 2G Era: most cities towns & Fiber deployed sub-urban between major areas cities • Fiber Network is deployed across the Netw
Slide 7: Fiber Consumption Directly Proportional to Data Growth
Fiber Consumption Directly Proportional to Data Growth Global fiber Consumption (m-fkm) Global IP Traffic (Exabytes/year) Global Annual Fiber Consumption (Mn fkm) 450 1200 Global Annual IP Traffic (Exabytes) 400 1000 350 300 Fiber Consumption 800 250 CAGR: 17% 600 200 Global IP traffic CAGR: 36% 150
Slide 8: Interesting New Developments Across the Globe
Interesting New Developments Across the Globe Verizon entered in long term contracts with At&T announced its 5G evolution plans Microsoft, Facebook and Telxius global fiber manufacturers Corning for beyond 2017. To reach at least 12.5 m completed the highest-capacity subsea ($1 bn deal) & Prysmian (
Slide 9: Global Demand for Optical Fiber Continues to Reflect Strong Annual Growth
Global Demand for Optical Fiber Continues to Reflect Strong Annual Growth 3,066 Optical Fiber Demand ( Mn fkm ) 467 426 56 North America Europe 382 50 47 China 38 45 India 314 40 Others CAGR: 17% 33 263 246 40 28 218 32 267 32 188 32 242 29 216 173 24 30 139 24 156 25 119 20 132 26 121 96 24 24 99 7
Slide 10: Sterlite Tech - Differentiated Play: Silicon-to-Software Offerings
Sterlite Tech - Differentiated Play: Silicon-to-Software Offerings A World’s Only & Most Integrated Company Manufacturing Optical Fiber from Silicon Ore in a Single Facility Silicon Ore Glass Preform Fiber Drawing Optical Fiber Optical Fiber Cable Translating to Industry Best Margin Profile 10
Slide 11: Sterlite Tech - Differentiated Play: Silicon-to-Software Offerings
Sterlite Tech - Differentiated Play: Silicon-to-Software Offerings B End to End Capability to Design, Build & Manage Data Networks for Telcos, Smart Cities, Rural Broadband & Defence Future Network Stack Digital Customer System of Marketing Management Engagement Software & System of Records Solution
Slide 12: Business Updates: Q2FY18
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Slide 13: Q2 Business Highlights at a glance
Q2 Business Highlights at a glance • Launched innovative high-speed 5G ready • Overall open order book value increased network solution, FlashFWD at IMC. Has from Rs. 3,140 Cr (at the end of Q1) to Rs. highest fiber density in most compact cable 3,832 Cr. Open order book to be further packaging stre
Slide 14: Awards and Accolades
Awards and Accolades Honoured with the Golden Peacock Won the TelecomLead OSS/BSS Award for “Excellence in Corporate Company award at the TelecomLead Governance - 2017” Awards 2017 The CPO Forum India & Awards 2017 for ‘Recognizing Procurement Jeewan Jyoti initiative won the “CSR Excellence’ - Winne
Slide 15: Scaling Product Business
Scaling Product Business 50 85 - 100% 60 - 65% 30 28 22 40% 12 Mar ’12 Mar ’16 Mar ’17 Sep ’17 Jun ’19 FY 17 FY 18 FY 19 Sterlite Tech :Optical Fibre Capacity ( Mn fkm) Optical Fibre Cable Capacity Utilization Achieved 30 Mnfkm in OF Volume in Q2FY18, as per plan New plant is located in Aurangab
Slide 16: Scaling Services & Software Business
Scaling Services & Software Business • Sterlite completed Jaipur smart city project • Govt announced list of third 30 smart cities • 100 Smart Cities Mission • Sterlite wins Kakinada Smart City order launched by the Govt. of India Network • Kakinada project under execution Solutions 2015 2016 2017 •
Slide 17: Long Term Customer Engagement to Drive Predictability
Long Term Customer Engagement to Drive Predictability Order Book Mix +65% 3832 3018 3140 2674 2339 2324 1541 1641 1124 700 1624 1550 1477 1499 1493 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Product Services & Software • Increasing Order book reflects predicable sale outlook for the company Numbers are in I
Slide 18: Financial Updates: Q2FY18
Financial Updates: Q2FY18 18
Slide 19: Quarterly Financial Performance
Quarterly Financial Performance +42% +63% 779 179 732 707 744 166 164 145 551 109 Q2 FY17 Q3 FY17 Q4 FY17 Q1 FY 18 Q2 FY 18 Q2 FY17 Q3 FY17 Q4 FY17 Q1 FY 18 Q2 FY 18 Revenue (INR Cr.) EBITDA (INR Cr.) +40% 71 64 61 51 49 Registered sales growth of 42% on YoY basis Strong growth in EBITDA and Net
Slide 20: Financial Performance
Financial Performance P&L (INR Cr) FY17 Q1 FY18 Q2 FY18 Revenue 2,594 744 779 EBIDTA 542 164 179 EBITDA % 21% 22% 23% Depreciation 159 41 44 EBIT 383 123 135 EBIT % 15% 17% 17% Interest 123 29 24 PBT 260 94 111 Tax 40 26 33 Net Income 201 61 71 (After Minority Interest) 20
Slide 21: Financial Performance
Financial Performance 860 0.9x -9% Cash flow Q2 FY18 782 -14% 0.8x Cash Profit ( After Tax ) 122 Operating Cash Flow 173 Capex 60 Net Cash flow 78 Q1 FY18 Q2 FY18 Q1 FY18 Q2 FY18 Net Debt Debt to Equity Ratio Values in INR Cr. 21
Slide 22: Strategic Direction
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Slide 23: Balanced Approach to drive Shareholders Value
Balanced Approach to drive Shareholders Value Integrated Solutions with focused customer base Defined principles for Inorganic Focus on Technology & Research: Growth: Capability addition Increasing patent portfolio Approach Consistent Returns to the Shareholders: Expanding ROCE for the 30% of PAT as
Slide 24: Focusing on Triple Bottom-line - Lives Impacted
Focusing on Triple Bottom-line - Lives Impacted 238,384 148,452 35,000 by Health by Education by Water Conservation initiatives initiatives initiatives 4,000 1,500 1,171 by Sanitation by Child Welfare by Women initiatives initiatives Empowerment initiatives 24
Slide 25: Strong Corporate Governance: New Addition to the Board
Strong Corporate Governance: New Addition to the Board Independent members in Board of Directors A. R. Narayanaswamy (Non-Executive & Independent Director) Chartered Accountant & Management Consultant with over 35 years of industry experience Member of The Institute of Chartered Accountants of I
Slide 26: Roadmap for 3 Years: 3x Growth
Roadmap for 3 Years: 3x Growth Platforms Drivers Glass/Pre-Form Scale, Technology: Value added Predictable Outcome Optical Fiber business products 3x Growth Scale, Application Engineering: Value added in Optical Fiber Cable business products, Net Income New Geo’s (100 Mn $ by FY20) Network Services
Slide 27: Demonstrated Historical Performance
Demonstrated Historical Performance +24% 2,594 +38% 542 2,275 475 1,619 345 1,096 1,148 151 181 FY 13 FY 14 FY 15 FY 16 FY17 FY 13 FY 14 FY 15 FY 16 FY17 Revenue EBITDA +44% 383 20% 21% 350 18% 249 7% 8% 90 94 FY 13 FY 14 FY 15 FY 16 FY17 FY 13 FY 14 FY 15 FY 16 FY17 EBIT ROCE • Stronger growth in E
Slide 28: Thank You
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