Sterlite Technologies Limited · NSE:STLTECH

Sterlite Technologies — Q2 FY21 Earnings Presentation

31 slides from Sterlite Technologies's earnings presentation, Oct 22, 2020

  1. Slide 1: Enabling a decade of digital network creation

    Enabling a decade of digital network creation Earnings Call Q2 FY’21 22nd Oct. 2020 stl.tech © 2020-2021 Sterlite Technologies Limited 1

  2. Slide 2: Safe Harbour

    Safe Harbour 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 genera

  3. Slide 3: Dr. Anand Agarwal, Group CEO and Whole Time Director

    Dr. Anand Agarwal Group CEO and Whole Time Director © 2020-2021 Sterlite Technologies Limited 3

  4. Slide 4: STLescope 2020 - A vision for 2023

    STLescope 2020 - A vision for 2023 1 2 3 4 5 STLescope 2020 - Taking Steps to turn Industry tailwinds Financial Q&A A vision for 2023 vision to reality continue to strengthen performance is on the cusp of take-off © 2020-2021 Sterlite Technologies Limited 4

  5. Slide 5: An unprecedented decade of digital network creation has started

    An unprecedented decade of digital network creation has started Unprecedented growth There is a high degree of urgency a happening in digital networks b to build these networks Exponential 12 Growth 9.97 • All network creators are investing heavily Global 10 IP Traffic Growth in Zettabytes in digita

  6. Slide 6: Over the last 25 years, we have systematically built a unique set of capabilities

    Over the last 25 years, we have systematically built a unique set of capabilities LARGE SCALE NETWORKS SYSTEM INTEGRATION 10 Years Network Design & Integration Solutions OPTICAL VIRTUALIZED INTERCONNECT WIRELESS STL can (SOFTWARE, CLOUD) Digital Network Integrate all these Integrator 25 years 3 year

  7. Slide 7: Our future roadmap is built on these 5 strategic pillars

    Our future roadmap is built on these 5 strategic pillars 1 2 3 4 5 Technology-led Key Accounts Large – Scale Ecosystem Top Talent and E2E Solutions Management Complex Alliances and Culture Integration Investments Increasing market Target 20 KAMs Developing better Increase Addressable Drive good retu

  8. Slide 8: Taking steps to turn vision to reality

    Taking steps to turn vision to reality 1 2 3 4 5 STLeScope 2020 - Taking steps to turn Industry tailwinds Financial Q&A A vision for 2023 vision to Reality continue to strengthen performance is on the cusp of take-off © 2020-2021 Sterlite Technologies Limited 8

  9. Slide 9: Technology led E2E solutions: Strengthening Opticonn

    1 Technology led E2E solutions: Strengthening Opticonn + + OPTICAL End 2 End INTERCONNECT Optical Connectivity SYSTEMS Solution Optical fibre High fibre count cable Cost Saving (Reduction in requirement of skilled labour in field) Faster Network Deployment (Plug & Play Model from factory to field) Q

  10. Slide 10: Key account management: Gaining higher wallet share

    2 Key account management: Gaining higher wallet share Partnering with Bharti Airtel to build modern Optical network in 10 circles, which shall form the foundation for many next gen services. STL offering Lead 360 solution which enables faster launch, enhanced network quality & multiple efficiencies.

  11. Slide 11: Large Scale System Integration: Executing despite pandemic

    3 Large Scale System Integration: Executing despite pandemic Network Transformative Futuristic SDN Modernisation digital inclusion ready state wide network Bharatnet Projects Bharatnet Projects Project Varun 83% Mahanet (A) 88% T-Fibre (A) 14% Completed Completed (Indian Navy Project): Completed Mah

  12. Slide 12: Ecosystem Alliance & Investments: Building access solutions

    4 Ecosystem Alliance & Investments: Building access solutions STL Portfolio Ecosystem Alliances Virtualised Access Products Inorganic & Organic Investments Open and virtualized Distribution Unit (oDU) Partnering to develop open, Ecosystem of virtualised & cloud native alliances Open and virtualized

  13. Slide 13: Top Talent & Culture: Building winning team

    5 Top Talent & Culture: Building winning team Stephan Szymanski Luis Fernando Leon Regional commercial executive Sales Manager America Central America Krish Prabhu – Advisory Board Mihir Modi - CFO Krish was CTO at AT&T where he Mihir is an experienced management was responsible for AT&T’s global pr

  14. Slide 14: Industry tailwinds continue to strengthen

    Industry tailwinds continue to strengthen 1 2 3 4 5 STLeScope 2020 - Turning vision to Industry tailwinds Financial Q&A A vision for 2023 reality continue to strengthen performance is on the cusp of take-off © 2020-2021 Sterlite Technologies Limited 14

  15. Slide 15: Q2 FY21 continue to see investments in digital networks

    Q2 FY21 continue to see investments in digital networks All Network Creators Investing Heavily in Digital Infrastructure… … and attracting Billions in Capital TELECOM OPERATORS PE INVESTMENT Oct 2020 Oct 2020 Aug 2020 Aug 2020 KKR invests $2.1 bn Telefonica to invest Airtel targeting 40 mn Etisalat,

  16. Slide 16: Telcos: 5G & FTTH roll out continue

    Telcos: 5G & FTTH roll out continue 5G Rollouts 5G Subscribers FTTH Rollouts  Globally 113 operators have  5G subscriptions reach at least  Europe is witnessing furious launched 5G with 52 launches in 138 mn. globally, representing FTTH buildouts with multiple 2020 1.5% of the entire global mobil

  17. Slide 17: Citizen Networks: PM Modi announces fibre to every Village

    Citizen Networks: PM Modi announces fibre to every Village • Police Station • Primary Health • Primary School • Post Office • Panchayat office STATES DISTRICT BLOCK GRAM PANCHAYAT VILLAGE 29 States + 8 UT 730+ Districts 6800+ Blocks 2,50,000 GPs 6 Lakh Villages Telecom Service Providers’ Network Bha

  18. Slide 18: Global optical fiber cable demand starts to grow

    Buoyed by investments in digital networks, Global optical fiber cable demand starts to grow… H2 2020 expected to grow 6% YoY Units: Mn. fkm N. America CHINA +20% Continued growth in Strong tender volumes 256 deployments specially & increase in 242 +6% from tier 2 /3 carriers deployment run rate 214

  19. Slide 19: Reinitiating Capex expansion of OFC to 33 Mn. fkm

    Reinitiating Capex expansion of OFC to 33 Mn. fkm. 33 18 8 FY15 FY19 June’21 Optical fibre cable capacity (Mn. Fkm) Enthused by the growth in global optical fibre cable demand, STL to expand the OFC capacity to 33 mn. fkm. © 2020-2021 Sterlite Technologies Limited 19

  20. Slide 20: Financial performance is on the cusp of take-off

    Financial performance is on the cusp of take-off 1 2 3 4 5 STLeScope 2020 - Turning vision to Industry tailwinds Financial Q&A A vision for 2023 Reality continue to strengthen performance is on the cusp of take-off © 2020-2021 Sterlite Technologies Limited 20

  21. Slide 21: Our participation funnel is growing

    Our participation funnel is growing …. Large Opportunities Open Participation Funnel (Rs. Cr.) LARGE EUROPEAN LARGE EUROPEAN ~12,000 TELCO TELCO ~10,100 FTTH ROLLOUT OPTICONN Strategic Opportunities LARGE INDIAN NORTH AMERICAN Q1 FY21 Q2 FY21 TELCO DISRUPTIVE TELCO ACCESS SOLUTIONS 5G NETWORKS © 202

  22. Slide 22: Translating into healthy order book

    Translating into healthy order book Open Order Book (Rs. Cr.) Order Book Spread (Rs. Cr.) ~ 8,141 10,312 10,705 10,037 8,535 ~ 2,564 Q3 FY20 Q4 FY20 Q1 FY21 Q2 FY21 6M FY21 FY 22 & Beyond Open Order Book Customer Segment wise Open Order Book Split Enterprises O&M 18.8% 25% 43.9% Telcos 36.9% 75% Cit

  23. Slide 23: Revenue mix is balanced across customers and geographies

    Revenue mix is balanced across customers and geographies Key Order Wins Customer Segments Geographical Distribution Q2 FY21 Revenues (Rs. Cr.) Revenues (Rs. Cr.) 5,154 2,036 5,154 2,036  Fiber Roll out for 10 circles for 2% 3% 9% Airtel in India 3% 15% 25% 20% 4%  Opticonn solution for a leading 2

  24. Slide 24: Quarterly revenues grow on Q-o-Q basis

    Quarterly revenues grow on Q-o-Q basis 1,360 298 1,203 1,160 1,160 247 226 212 876 131 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 Q2 FY21 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21 Q2 FY21 Revenue (INR Cr.) EBITDA (INR Cr.) 160  Capacity utilisations have exceeded pre-covid levels and will see further improvement in Q3

  25. Slide 25: The business continues to generate positive free cash flows

    The business continues to generate positive free cash flows 2,158 1,970 122 138 Free Cash Flow @ consolidated level – H1 FY21 Rs. Cr. 31 372 268 Cash Profit after Tax 216 (Increase) / Decrease in working Capital 156 Operating Cash Flow 372 CAPEX (268) Free Cash Flow 103 Net Debt Operating Capex Inor

  26. Slide 26: Financials: Abridged Version

    Financials: Abridged Version Growth Balance Sheet (INR Cr.) FY20 H1 FY21 P&L (INR Cr.) Q1 FY21 Q2 FY21 (%) Revenue 876 1,160 32% Net Worth 2,023 1,854 EBIDTA 131 212 61% Net Debt 1,970 2,158 EBITDA % 15% 18% Depreciation 74 82 Total 3,993 4,012 EBIT 57 130 128% Fixed Assets 2,536 2,707 Interest 50 5

  27. Slide 27: Completed buyback 2020 returning Rs. 100 cr. to shareholders

    We have successfully completed buyback 2020 by returning Rs. 100 cr. to shareholders We have completed the buyback with returning Rs. 100 Cr. to shareholders We bought back 88.67 lacs outstanding shares BUYBACK 2020 Value creation for shareholders with 158% increase in price since announcement of bu

  28. Slide 28: We are on track to deliver our Vision 2023

    We are on track to deliver our Vision 2023 We shall double our revenue & reduce net debt/equity to half while maintaining RoCE >20% Growth Revenue : Rs. 10,000 Cr. Capital Structure Net debt/equity < 0.5 Returns RoCE >20% © 2020-2021 Sterlite Technologies Limited 28

  29. Slide 29: STL is ready for a decade-long digital network creation cycle

    STL is ready for a decade-long digital network creation cycle • An unprecedented decade of digital network creation has started • STL has unique capabilities to be a leading digital network integrator and we continue to invest in technology and talent • With continued investment momentum behind netw

  30. Slide 30: Q & A

    Q&A 1 2 3 4 5 STLeScope 2020 - Turning vision to Industry tailwinds Financial Q&A A vision for 2023 Reality continue to strengthen performance is on the cusp of take-off © 2020-2021 Sterlite Technologies Limited 30 30

  31. Slide 31: Thanks

    Thanks © 2020-2021 Sterlite Technologies Limited 31

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