Hfcl Limited · NSE:HFCL
Hfcl — Q4 FY2022 Earnings Presentation
44 slides from Hfcl's earnings presentation, Apr 29, 2022
Slide 1: Exchange filing cover letter for earnings presentation
HFCL Limited m HFCL GROUP , 8, Commercial Complex, Masjid Moth, Greater Kailash - 11, New Delhi -110048, India Tel : (+91 11) 3520 9400, 3520 9500 Fax: (+91 11) 3520 9525 Web : www.hfcl.com Email secretarial@hfcl.com HFCL/SEC/22-23 April 29, 2022 The BSE Ltd. The National Stock Exchange of India Ltd
Slide 2: Investor Presentation March 2022
Investor Presentation March 2022 HFCL Limited
Slide 3: Index
INDEX HFCL at a Glance 03 Opportunity Landscape 13 19 Strategic Priorities Financial Drivers 25 ESG 31 Appendix 35 HFCL Limited | Investor Presentation 2
Slide 4: HFCL at a Glance
HFCL at a Glance 01 02 03 04 05 06 01 HFCL at a Glance HFCL Limited | Investor Presentation 3 Hyderabad Facility
Slide 5: A leading innovation-led technology enterprise
HFCL at a Glance 01 02 03 04 05 06 A leading innovation-led technology enterprise Integrated next-gen communication Key Sectors products and solutions provider 72% Largest market share in Optic Fibre Cable (OFC) of Revenue supplies in India Innovative product offerings Public Telecommunication Compr
Slide 6: Creating consistent value for investors
HFCL at a Glance 01 02 03 04 05 06 A leading innovation-led technology enterprise Creating consistent value for investors 16.3% 26.6% 21.4% Revenue – EBITDA – PAT – 5 year CAGR 5 year CAGR 5 year CAGR 26.0% 14.7% 19.3% Gross Margin EBITDA Margin RoCE 0.26x ~INR 5,300 Cr (~USD 700 mn) Debt-Equity Ord
Slide 7: Our product offering
HFCL at a Glance 01 02 03 04 05 06 Our product offering Optic Fibre / Optical Fibre Cables Passive Connectivity Solutions Telecommunication Products Defence Electronics Armoured Cable Micro Cable Cable Assemblies High Density Point to point Indoor & Outdoor Electro Optical Electronic Fuses Cabinets
Slide 8: Comprehensive network solutions
HFCL at a Glance 01 02 03 04 05 06 Comprehensive network solutions Public Telecommunication Solutions Defence Communication Solutions Railway Communications Comprehensive solutions for building of wireless and Solutions optical telecommunications networks Optical Fiber Cable and Optical Fiber Monito
Slide 9: Marquee network projects under implementation
HFCL at a Glance 01 02 03 04 05 06 Marquee network projects under implementation Public Defence Railway Telecommunication Communication Communication Rolling out backbone and backhaul Optical Fiber Cable Rollout of exclusive and dedicated nationwide DWDM Implementing telecom networks for seven green
Slide 10: Long standing relationships with major stakeholders
HFCL at a Glance 01 02 03 04 05 06 Long standing relationships with major stakeholders HFCL Limited | Investor Presentation 9
Slide 11: Our global presence
HFCL at a Glance 01 02 03 04 05 06 Our global presence Customers in 30+ Countries Canada Irelan d German UK Poland Hungary 2 R&D Centres of Excellence USA y Romania Austria Solvenia Czech Republic Albani in Bengaluru & Gurugram Portugal Spain a Turkey Greece Cyprus Mexico Jordan Nepal Qatar Egypt Ba
Slide 12: State-of-the-art facilities buoyed by capacity expansion
HFCL at a Glance 01 02 03 04 05 06 State-of-the-art facilities buoyed by capacity expansion 5 Manufacturing facilities across India Hyderabad, Telangana Chennai, Tamil Nadu 1 2 3 with capacities of: (through subsidiary company HTL Ltd) 8 mn fkm 3.6 mn fkm 11.75 mn fkm Optic fiber OFC OFC 23.35 mn fk
Slide 13: Focusing on commercialization of Global 5G opportunities
HFCL at a Glance 01 02 03 04 05 06 Focusing on commercialization of Global 5G opportunities Addressable product Portfolio under Impact/Opportunity Cumulative market size segment development capitalization (FY21-25) 5G Transport products • Cell Site Router Modernization requirement for USD 16.4 bn •
Slide 14: Opportunity Landscape
02 Opportunity Landscape HFCL Limited | Investor Presentation 13
Slide 15: World's 2nd largest telecom market at an inflection point
01 Opportunity Landscape 02 03 04 05 06 Telecom The world’s 2nd largest telecom market with 2nd highest internet users at an inflection point Driven by Fast-tracked by Economic impact of 5G - estimated to reach Budget 2022 impetus USD 1 trillion by 2035 5G spectrum allocation in Growing domestic mar
Slide 16: Demand boost across the portfolio
01 Opportunity Landscape 02 03 04 05 06 Telecom Demand boost across the portfolio TAM over FY21-25 ~USD 6.2 bn TAM ~USD 7.8 bn TAM for ~USD 18 bn TAM for for OF/OFC and Accessories Telecom Equipment 5G Equipment and Services Total Addressable Market (TAM) of USD 32 bn during FY21-25 in India HFCL Li
Slide 17: Modernisation drive in India's defence forces
01 Opportunity Landscape 02 03 04 05 06 Defence New vistas opened by modernisation drive in India’s defence forces Driven by Fast-tracked by Import reduction from 65% to 30% by FY32 on Budget 2022 impetus the back of initiatives like Aatma Nirbhar Bharat, 68% capital procurement Make in India, Defen
Slide 18: Robust demand across product segments
01 Opportunity Landscape 02 03 04 05 06 Defence Robust demand across product segments Market size per year by FY25 ~USD 2.9 bn ~USD 0.39 bn ~USD 0.20 bn Software ~USD 0.05 bn High-capacity Electro-optics Electronic fuse defined radio (SDR) radio relay (HCRR) TAM for HFCL in defence electronics in In
Slide 19: Transforming the world's 4th largest rail network
01 Opportunity Landscape 02 03 04 05 06 Railways Transforming the world’s 4th largest rail network Driven by Overall Project Costs Opportunity Dedicated Freight Corridors – Projects with capital cost of construction Greenfield projects with 3 projects in DPR stage of USD 24.4 bn in the DPR stage, li
Slide 20: Strategic Priorities
03 Strategic Priorities HFCL Limited | Investor Presentation 19
Slide 21: HFCL's accelerated growth strategy
01 02 Strategic Priorities 03 04 05 06 HFCL’s accelerated growth strategy Focusing on upcoming opportunities Integral part of Building new structures to focus in Telecom, Defence and Railways India’s digital journey on key specialization areas Market opportunity of ~USD 117 bn in 5G alone Implementi
Slide 22: HFCL's accelerated growth strategy
01 02 Strategic Priorities 03 04 05 06 HFCL’s accelerated growth strategy Expanding manufacturing Product mix shift to margin accretive Extending capacities own designed products market reach Expanding OFC & Fiber capacity at Hyderabad, Aim to increase our revenue mix coming from Exports of OFC and
Slide 23: Using R&D backbone for a futuristic portfolio
01 02 Strategic Priorities 03 04 05 06 Using R&D backbone for a futuristic portfolio Strategic focus areas Distinctive Investment in technology Strengthen offering in offerings including 5G solutions key application sectors Strengthened by In-house R&D team Partnering with renowned Products under pl
Slide 24: Towards product-led growth
01 02 Strategic Priorities 03 04 05 06 Towards product-led growth Revenue mix to shift towards margin accretive products through expanded capacity in OFC/FTTH segment and development of new telecom & defence electronics products 27% 43% Leading to 57% • Access to new geographies 73% • Uniform revenu
Slide 25: Intensifying global footprint to capitalize on demand
01 02 Strategic Priorities 03 04 05 06 Intensifying global footprint to capitalize on demand Opportunities in exports Multiple inquiries received for new products PLI making exports immensely attractive and profitable Leveraging core strengths Products at par with international New Product Design St
Slide 26: Financial Drivers
04 Financial Drivers HFCL Limited | Investor Presentation 25
Slide 27: Healthy financials to support growth
01 02 03 Financial Drivers 04 05 06 Healthy financials to support growth Revenue (INR crores) Gross Profit (INR crores) & EBIDTA (INR crores) & PAT (INR crores) & Gross Margin (%) EBITDA Margin (%) PAT Margin (%) 26 14.66 6.90 4,423 4,727 6.17 5.56 3,839 24 13.44 13.21 2,672 23 3,218 2,992 2,055 905
Slide 28: Q4FY22 Key Highlights - Consolidated
01 02 03 Financial Drivers 04 05 06 Q4FY22 Key Highlights - Consolidated Total Revenue (INR crores) EBITDA (INR crores) & EBITDA Margin (%) • Joined hands with Aprecomm, the leading Al-powered Wi-Fi analytics 1391 13.44% 13.02% 1183 technology provider, to power its Network offerings • Partnered wit
Slide 29: Q4FY22 Consolidated Income Statement
01 02 03 Financial Drivers 04 05 06 Q4FY22 Consolidated Income Statement Change Change Particulars (INR crores) Q4-FY22 Q3-FY22 Q4-FY21 Q-o-Q Y-o-Y Revenue from Operations 1,183 1,215 -2.63% 1,391 -14.95% Other Income 30 4 6 Total Income 1,213 1,219 -0.49% 1,397 -13.17% Total Expenses 1,059 1,045 1,
Slide 30: FY22 Consolidated Income Statement
01 02 03 Financial Drivers 04 05 06 FY22 Consolidated Income Statement Particulars (INR crore) FY22 FY21 Change Y-o-Y Revenue from Operations 4,727 4,423 6.87% Other Income 43 35 Total Income 4,770 4,458 7.00% Total Expenses 4,077 3,873 EBITDA 693 585 18.46% EBITDA Margin (%) 14.66% 13.23% 143 Bps D
Slide 31: Diversified Revenue Streams
01 02 03 Financial Drivers 04 05 06 Diversified Revenue Streams Exports Revenue Share (%) Revenue Share by Type of Customers (%) 8 51 59 5 68 3 49 41 32 FY20 FY21 FY22 FY20 FY21 FY22 Government Private HFCL Limited | Investor Presentation 30
Slide 32: ESG
05 ESG HFCL Limited | Investor Presentation 31
Slide 33: Environmentally-conscious operations
01 02 03 04 ESG 05 06 Environmentally-conscious operations Sewage Treatment Plant Partnership with Greentek (STP) of capacity 30 KL per Reman for e-waste day to recycle all domestic management wastewater at Goa plant Sustainable packaging Replacement of using corrugated paper conventional lighting b
Slide 34: Committed to community welfare
01 02 03 04 ESG 05 06 Committed to community welfare Healthcare Education Old age care MMUs PEHAL SHEOWS Running 5 Mobile Medical Clinics at different locations for providing preventive Contributing for smart classes projects in Constructed women’s wing of healthcare facilities in remote areas. gove
Slide 35: In Summary
01 02 03 04 ESG 05 06 In Summary Investments in R&D and Network Solution Technology Capabilities Expansion of Venturing into frontiers of Capacities technology 5G, Defence Equipment, Manufacturing under Make in India Program etc. Continuous backward Expanding Global integration in Market Access OFC
Slide 36: Appendix
06 Appendix HFCL Limited | Investor Presentation 35
Slide 37: Consolidated Profit & Loss Statement
01 02 03 04 05 Appendix 06 Consolidated Profit & Loss Statement Particulars (INR crore) FY20 FY21 FY22 Revenue from Operations 3,839 4,423 4,727 Other Income 22 35 43 Total Income 3,861 4,458 4,770 Total Expenses 3,345 3,873 4,077 EBITDA 516 584 693 EBITDA Margin (%) 13.44% 13.21% 14.66% Depreciatio
Slide 38: Consolidated Balance Sheet
01 02 03 04 05 Appendix 06 Consolidated Balance Sheet Equities & Liabilities Assets (INR crore) FY20 FY21 FY22 FY20 FY21 FY22 (INR crore) (A) Property plant & Equipment 437 443 465 (A) Share Capital 128 128 137 (B) Capital Work in Progress 15 12 47 (B) Other Equity 1,540 1,788 2,661 (C) Right-of-use
Slide 39: Led by an experienced management team
01 02 03 04 05 Appendix 06 Led by an experienced management team S.K. Garg V.R. Jain Jitendra Chaudhary Harsh Pagay Executive Director Executive President Group Chief Financial Officer Executive President (OFC) (Growth Strategy) (Communications) Dr. Peter Weimann Col B.B. Singh Rajesh Jain Jayanta D
Slide 40: Governed by an experienced Board
01 02 03 04 05 Appendix 06 Governed by an experienced Board Mahendra Nahata Arvind Kharabanda Dr. R. M. Kastia Ramakrishna Eda Promoter and Non-Executive Director Non-Executive Director Non-executive Director Managing Director and Nominee - IDBI Bharat Pal Singh Surendra Singh Sirohi Dr.Tamali Sen A
Slide 41: Share Price performance and shareholding pattern
01 02 03 04 05 Appendix 06 Share Price performance and shareholding pattern Share Price Performance (Jan’22-Mar’22) Listed on BSE and NSE (Scrip code BSE: 500183 & NSE: HFCL) Shareholding Pattern 120 62000 (as at 31st Mar 2022) 100 60000 58000 80 56000 60 54000 40 39.23% 52000 52.27% 20 50000 0 4800
Slide 42: Abbreviations / Description
01 02 03 04 05 Appendix 06 Abbreviations / Description Order book comprises anticipated revenues from the unexecuted portions of existing contracts (including signed contracts for Order Book which all pre-conditions to entry into force have been met & letters of acceptance issued by the customer pri
Slide 43: Thank you
Thank you Amit Agarwal Head – Investor Relations HFCL Limited Tel: +91-11-3520 9400 Email: ir@hfcl.com Corporate Office 8 Commercial Complex, Masjid Moth, Greater Kailash Part 2, New Delhi, Delhi 110048 HFCL Limited | Investor Presentation
Slide 44: 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