Release Date: July 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revenue increased by 10% year-over-year to INR9,421 million.
- EBITDA rose by 3% compared to the same quarter last year, reaching INR1,784 million.
- Sify commissioned 6.5-megawatt capacity in Mumbai, expanding its data center capabilities.
- The company successfully completed a rights issue, enhancing its liquidity and leveraging ability.
- Sify's network connectivity service now includes 9,415 SD-WAN service points across India, a significant expansion.
Negative Points
- Loss before tax was INR46 million, and loss after tax was INR105 million for the quarter.
- Digital services revenue declined as the company transitions from project-based to annuity-based revenue models.
- Capital expenditure for the quarter was high at INR2,656 million, indicating significant ongoing investment requirements.
- The company did not provide a specific roadmap for future data center capacity expansion, creating some uncertainty.
- Artificial intelligence demand in India has not yet taken off, limiting potential growth in this area.
Q & A Highlights
Q: What are the primary drivers of data center demand within India? Are you seeing more demand from hyperscalers? And are you seeing any benefit from artificial intelligence yet?
A: Most of the demand is coming from hyperscalers and enterprises. AI in India has not taken off yet, but there are ongoing discussions and future potential. Currently, the demand is primarily from hyperscalers and regular enterprise businesses. India still has a long way to go in moving from server rooms to co-locations. - Raju Vegesna, Chairman & Managing Director
Q: Could you give us an update on the roadmap for the year in terms of new data center capacity?
A: While I can't provide specific future numbers, we are building enough capacities in Mumbai, Noida, Chennai, and Hyderabad data centers. We see a good trend of opportunities coming in. - Raju Vegesna, Chairman & Managing Director
Q: What is the outlook for CapEx for the full year? And with the rights offering completed, do you have enough liquidity to fund your capital needs for the remainder of the year?
A: We spent about INR2,645 million in Q1, and this trend will continue. The successful rights issue enhances our leveraging ability from the banking system, helping us meet funding requirements for data center and network infrastructure expansion. - M.P. Vijay Kumar, Executive Director and Group CFO
Q: Digital services declined in the quarter. Can you give us more color on what was driving the decline in that segment?
A: We are transitioning from a project-based to an annuity-based revenue model and building skill sets. This initiative started two years ago and will continue for the next couple of years to meet India enterprise digitalization requirements. - M.P. Vijay Kumar, Executive Director and Group CFO
Q: The growth in the data center segment accelerated this quarter. Was there anything one-time in the quarter, or is that a good number to build our models off of?
A: There was no one-time event; the growth is recurring. - M.P. Vijay Kumar, Executive Director and Group CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
