STL sees a promising start to FY25; sales gain momentum

MUMBAI, India, July 30, 2024 /PRNewswire/ -- STL (NSE: STLTECH), a leading Optical and Digital solutions company, today announced its financial results for the quarter ended 30^th June 2024. STL reported revenues of INR 1,218 Cr and strengthened its balance sheet by reducing its net debt by INR 769 Cr vis-a-vis FY24.

STL extensively focused on its strategic priorities of customer centricity and cost leadership, thereby gaining traction in orders and sales across its Optical business in both the Optical Fibre Cable (OFC) and Optical Connectivity (OC) portfolios. Delivering purpose-engineered solutions that combine the two portfolios has come out as one of its core strengths, as visible in an uptick in the Optical Connectivity attach rate to 23% in the current quarter. Multiple deal wins contributed to a sequential increase in the revenues and EBITDA for this business.

• Archtop Fiber (US) - Provided high fibre count optical cables featuring loose-tube, and ribbon designs combined with hardened Connectivity solutions - OptoBlaze and OptoBolt
• Netomnia (UK) - Offered A2 Multitube Micro Optical Fibre cables and ultra-lightweight aerial cables, for fast rollouts and high performance
• Du Telecom (MEA) - Provided advanced optical cable designs with bend-resistant fibre to deliver better network performance for FTTH
• Vocus (Australia) - Supplied ultra-slim profile Micro™ cables with its flagship Stellar™ fibre, the world's first bend-resilient fibre with backward compatibility with legacy networks

These diversified and long-term customer wins have further strengthened STL's position in the telecom/AltNet segments.

Beyond FY25, the company identified AI data centres segment as a future growth area. With the growing demand for AI-led use cases, data centre CapEx will grow at 18% CAGR till 2028^[1]. These GPU-heavy data centres will require 5x more optical connections as compared to current levels, driven by factors like a ~50% increase in server density and higher bandwidth requirements migrating towards 100 GbE. These will also require more compact, high-density optical fibre cables and connectors. STL is targeting ~25% of its revenue from this growing segment in the medium term.

In its Global Services business, STL achieved a key milestone in the demerger process, receiving approvals from its shareholders and secured and unsecured creditors. The business recently partnered with UK-based Connexin to enable fast and reliable broadband connectivity. STL's newly incubated Digital business continued on the path to profitability, seeing momentum with ~25 global customers.

Ankit Agarwal, Managing Director, STL, said: "We are strategically enhancing our offerings to prioritise customer centricity and provide integrated solutions within the Telecom/AltNet segments. At the same time, we are gearing up to make a substantial impact in the emerging AI-driven data centre segment. Early signs of market recovery are encouraging, and we enter FY25 with optimism, and a clear strategic focus. We are confident in our future growth, with our strong R&D capabilities playing a crucial role in driving value for our customers."

Financial highlights (INR Cr)

^[1] Dell'Oro group

About STL - Sterlite Technologies Ltd:

STL is a leading global optical and digital solutions company providing advanced offerings to build 5G, Rural, FTTx, Enterprise, and Data Centre networks. Read more, Contact us, stl.tech | Twitter | LinkedIn | YouTube

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