Sterlite Tech revenue drops 3.5% in Q2 FY2016-17

Sterlite Technologies, a telecom major, known to design, build and manage data networks, revenue dropped by 3 percent in Q2 FY 2016-17 despite doubling of international sales from Rs 115 crore to Rs 231 crore.

The quarter saw a strong and expanding global demand for optical fibre, supported by growth in the China market. Sterlite Tech posted a total volume of 6.1 million fkm in Q2 FY’17 vs 5.5 million fkm in Q1 FY’17, operating at close to 25 million fkm annual capacity.

At the start of this year, the company had embarked on the journey of expanding its optical fibre capacity to 30 million fkm by mid FY18, which has been progressing well. The profit after tax (PAT) stood at Rs 51 crore which included one-time tax benefit on account of merger of passive infrastructure business of Speedon Network (a wholly-owned subsidiary of the company) into parent company Sterlite Technologies.

The board of directors has approved the company’s dividend policy that entails dividend of around 30 per cent of net profits on the consolidated financials basis. In line with the philosophy of the said policy the board will consider declaration of interim dividend.

Elaborating on Q2 performance, Dr Anand Agarwal, CEO, Sterlite Technologies said, "We are witnessing an expanding optical fibre demand globally and good traction in upcoming network and system integration opportunities in India. With strong industry sentiments around 4G, Smart City, BharatNet and FTTH deployments, we remain bullish on India market and opportunities it presents across our business segments from optical communication products to services and software."

Speaking on the performance in the coming quarters, Anand stated, "With an expanding order book of currently Rs 2,324 crore and a strong pipeline of over Rs 10,000 crore of opportunities under decision, we are committed to deliver stronger performance in the coming quarters."

Sterlite Tech also announced its smarter network order win from Ahmedabad Janmarg, a public transit system of Ahmedabad Municipal Corporation. As part of the project, an optical fibre backhaul infrastructure will be deployed to interconnect Ahmedabad’s BRTS corridor to the main data centre and disaster recovery site through passive network integration. Various smart city components will ride on this network.

On the business outlook, Pravin Agarwal, vice chairman, Sterlite Technologies said, "With growing data demand, broadband infrastructure will amplify revenues for telecom providers and ensure needed customer experience and loyalty."

He also highlighted the criticality of broadband highways to bridge the urban-rural divide and create numerous opportunities to increase the internet economy.

On the role Sterlite Tech can play in this transformation, he said, “We are focused on executing our customer-centric strategy and increase emphasis of our smarter networks offering to leverage the broadband explosion.”