Sterlite Technologies Limited · NSE:STLTECH
Sterlite Technologies — Q1 FY2019 Earnings Presentation
21 slides from Sterlite Technologies's earnings presentation, Jul 19, 2018
Slide 1: Earnings Call – 19 July 2018
Earnings Call– 19 July 2018 www.sterlitetech.com 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: Evolving Industry Dynamics
Evolving Industry Dynamics 3
Slide 4: Data is now a basic consumption need
Data is now a basic consumption need - per capita consumption is doubling every 18 months 4X 8X MORE 22X Internet Connected Content Data per Users Devices Consumer Internet Users Connected Devices MORE DATA Average Data per Smartphone (Bn) 8.3 (Bn) 31.4 [GB/Month] per Application 5.3 17.5 2.4 4.0 17
Slide 5: Capex intensity to remain strong driven by evolution in data networks
Capex Intensity to remain strong driven by evolution in data networks Data led capex, riding on fiber Top 20 Global Telco Capex (USD Bn) Global OFC Consumption (Mnfkm) 3G to 4G: 1.6x 3G to 4G: 3.0x 1,342 2,345 2G to 3G: 1.4x 822 602 2G to 3G: 1.9x 790 426 2G (CY1999 to 2004) 3G (CY2005 to 2010) 4G (
Slide 6: 5G is now on the anvil
5G is now on the anvil Large scale trials in 2019 C-Band leader 28 GHz Trials 400MHZ of C-Band 2018 5G Deployment 28 GHz mobile Completes interop 5G@ 2GHz trials NSA & Mid-Band Advocate Mid-band 5G 5G network share in Japan Live in 2018 (pre 28 GHz Trials commercial) 4.5-4.9GHz nationwide 5G Trial p
Slide 7: Which is expected to boost the capex investment cycle
Which is expected to boost the capex investment cycle Globally, commercial 5G is expected to be largely deployed between 2020-2025 End-to-end Commercial 5G Trials Launch at Scale 2017 2018 2019 2020 2021 2022 2025 5G PoCs & 5G will account for 31% Field Trials City-level 5G National Coverage starts
Slide 8: Also leading to structural change in the network architecture
Also leading to structural change in the network architecture 1 2 Increasing relevance of fiber in data networks Deeper convergence of fixed-wireless Deep Fiberization Millimetre Radio Wave Emergence of new class of 3 4 customers (OTT) Application centric product development New business m
Slide 9: Fiber is the only medium to support the next wave of data traffic
Fiber is the only medium to support the next wave of data traffic 1,400 Global Fiber Consumption (Mn fkm) Global IP Traffic (Exabyte Per Year) 1,200 1,000 800 600 Regression statistics Multiple R =0.99 400 R Square: 0.98 200 - CY05 CY06 CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 CY15 CY16 CY17 Consum
Slide 10: Sterlite Tech - Data focussed player
Sterlite Tech- Data focussed player 10
Slide 11: Our Unique Global Position
Our Unique Global Position Best in Class “Data Only” Global Presence in 100+ Growing faster than Offerings Industry Leading Margins countries Industry Integrated global Only Company in the Doubling of profits in two 60% growth in Patents in 3 manufacturing platforms World to provide Silicon to years
Slide 12: Leading to faster growth than the market with leading margin profile
Leading to faster growth than the market with leading margin profile Global Fiber Demand (Mnfkm) Sterlite Tech Fiber Volumes (mn fkm) 493 30 2x 3x 246 12 CY12 CY17 FY 12 FY18 ~25% • Sterlite Tech has been growing faster than the ~15% Industry, expanding its global market share • Sterlite Tech margin
Slide 13: Demonstrated value compounding
Demonstrated value compounding +29% 789 334 +47% 542 475 201 154 FY 16 FY17 FY18 FY 16 FY 17 FY 18 EBITDA (INR Cr.) 3 Year PAT (INR Cr.) - Post de-merger of Power Business 30% 20% 21% • Sterlite Tech has demonstrated compounding growth historically, led by integrated global platforms in product busi
Slide 14: With increasing future visibility
With increasing future visibility 1.8x +92% 1.6x 6034 6,034 5223 5,223 4574 1.2x 3832 3,205 3337 3140 4939 1x 3,018 4095 2,594 3335 2,275 2,253 2339 1641 1499 1493 1239 1128 1094 FY16 FY17 FY18 TTM Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Revenues(INR Cr.) Products Order Book (INR Cr.) Order Book (INR Cr.
Slide 15: Q1FY19 Updates
Q1FY19 Updates 15
Slide 16: Acquisition of Metallurgica Bresciana: Strategic Rationale
Acquisition of Metallurgica Bresciana Sterlite Tech to acquire 100% of the target from current shareholders Metallurgica Values in INR Cr. Sterlite Tech Consolidated Bresciana (FY18) Proforma TTM Adds 3 Mnfkm, which can be further expanded to 5 Mnkfm with minimal capex Revenue 3,205 364 3,569 Transa
Slide 17: Other Key Developments at a glance
Other Key Developments at a glance People & Processes Sterlite Tech appointed former Intel India president Kumud Srinivasan to its Board. As a non-executive and independent director, Srinivasan will be on Sterlite Tech’s Board for a term of five years Srinivasan has spent 30 years at Intel in the US
Slide 18: Demonstrated Growth on QoQ basis
Demonstrated Growth on QoQ basis +18% +54% 835 847 877 744 779 238 252 208 164 179 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1FY19 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Revenue (INR Cr.) EBITDA (INR Cr.) +99% 121 112 90 71 61 Strong bottom-line growth: 121 Cr (99% y-o-y growth) EBITDA crosses the 250 C
Slide 19: Financial Performance
Financial Performance P&L (Cr.) FY17 FY18 Q1 FY19 Revenue 2,594 3,205 877 EBIDTA 542 789 252 EBITDA % 21% 25% 29% Depreciation 159 182 45 EBIT 383 606 207 EBIT % 15% 19% 24% Interest 123 104 23 PBT 260 503 184 Tax 40 133 55 Net Income 201 334 121 (After Minority Interest) ROCE % 21% 30% 36% 19
Slide 20: Driven by Shareholder Value Creation
Driven by Shareholder Value Creation We have been consistently doubling our PAT every 2 year 2x ++ $100Mn++ 2x++ 334 Cr Net Income Growth 154 Cr FY 16 FY 18 FY 20e Software Acquisition Acquisition of Metallurgica $100 Mn PAT: Strategic Demerger: Simplification of Bresciana Plan by FY20 Corporate Str
Slide 21: Thank You
€ Sterlite Tech Thank You
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