Sterlite Technologies Ltd

- The company has approval for a rights issue raising up to Rs.1000 crores but there is no immediate plan; they continue to evaluate strategic needs and market conditions before deciding. - Focus is on debt reduction with an internal target to reduce net debt by Rs.200-250 crores in FY24. - Capex for FY24 has been reduced from Rs.350-400 crores to about Rs.250 crores to manage cash efficiently. - No specific comments on new debt raising at this stage; monitoring market and demand conditions to decide. - The demerger of the Global Service business will include transferring the specific debt attributable to that business upon requisite approvals, but no additional debt raising disclosed.

- The capex cycle has been largely completed with the operationalization of the US facility. - The capex target for FY24 has been reduced from Rs. 350-400 crores to Rs. 250 crores. - The reduction in capex is primarily due to deferral of phase II capacity-building investments at the US plant, waiting for demand to pick up. - Current capital work in progress stands at Rs. 180 crores, mainly related to the US facility; capitalization will occur once lines are commissioned. - Future capex focus will be minimal, limited to maintenance and no major new capacity additions beyond the US plant. - Capital allocation priority going forward is towards debt reduction rather than aggressive capex. - The company is also investing around Rs. 120 crores in its digital business in FY24, targeting EBITDA breakeven by Q4 FY24.

- Revenue is expected to decline in FY24 due to inventory correction in North America and market challenges. - Growth in North America market is likely to resume from Q1 FY25 onwards with ramp-up of US plant and demand recovery. - Optical fiber cable (OFC) market share is stable and expected to grow from the second half of FY24 onwards. - Fiber rollout in India shows strong progress with government-backed projects like BharatNet Phase 3 (Rs.1.39 lakh crore). - Optical connectivity attach rates increased to 13% from 10% quarter-on-quarter; commercialization of new products will further improve this. - Digital business growing rapidly with a strong order book (~Rs.750-780 crores), aiming for EBITDA breakeven by Q4 FY24. - Global services business executing selectively with improving profitability. - Medium-term demand for optical fiber cable volumes expected to grow to 623 million fiber kilometers by 2027 from 535 million in 2022. - Market CAGR estimates: North America ~10.1%, Europe ~4.7%, India ~9.5% between 2023-2028.

- Revenue is expected to decline in FY24 due to inventory correction in North America, with recovery anticipated from Q1 FY25 onwards. - EBITDA margins have improved, with H1 FY24 EBITDA margin at 20.8% for the optical business and overall margin expansion of 230 bps Y-o-Y. - STL Digital aims to achieve EBITDA breakeven by Q4 FY24, with revenue growing and EBITDA losses trending downwards. - Capex cycle is complete with US facility operationalized; focus will be on improving factory utilization and reducing debt. - Net debt reduction target is Rs. 200-250 crores for FY24, supporting financial health and profitability. - Growth is expected from increasing optical connectivity attach rates (improved from 10% to 13%) and market share expansion in India, EMEA, and APAC. - Global services are focusing on select projects to improve profitability with an 81% increase in H1 FY24 EBITDA. - Long-term growth driven by government projects like BharatNet Phase III and expanding 5G/data center markets.

- The open order book at the end of Q2 FY24 is Rs. 10,516 crores. - The order book is well diversified across customer segments and businesses. - The digital business has a healthy order book close to Rs. 750 crores. - Discussions and progress are ongoing for the BharatNet Phase III project valued at around Rs. 1.4 lakh crores, with execution over 2.5-3 years and maintenance for 7 years. - The T-Fiber project in the Global Services business is progressing with working capital employed of about Rs. 700 crores, though execution is complex and milestone-based. - Ongoing demand recovery expected in North America from Q1 FY25, which should support new orders. - Management is focused on capturing market share in key regions like North America, Europe, and India to fill volume gaps.