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About the Company: Pace Digitek Ltd. (PDL) is a multi-disciplinary solutions provider with presence across Telecom, Energy and ICT verticals In telecom vertical, it provides end-to-end integrated solutions in the tower infrastructure and optical fibre cables (OFC). In Energy Segment, it a) undertakes solar energy projects on a build, own and operate' model, b) solarization of telecom towers, c) undertakes BESS projects and d) manufacture and supply lithium-ion battery systems. In ICT vertical, it...
Company is a telecom infrastructure solution provider with a significant focus on the telecom infrastructure industry including telecom towers and optical fibre cables. Company undertake manufacturing, installation and commissioning services of products at the site and undertake operation and maintenance of site including tower erection and optical fiber cable laying as turnkey solution. Company generate its revenue from operations from 3 verticals i.e., telecommunications, energy, and...
Pace Digitek Ltd. (PDL) is a telecom infrastructure solution provider with a primary focus on the telecom infrastructure industry including telecom towers and optical fibre cables. PDL generates revenue under three verticals namely telecommunications, Energy, Information & communication technology (ICT). With the acquisition of GE Power Electronics India in 2014, the company commenced end to end manufacturing of direct current systems which are tailored for telecom tower companies and operators helping it in energy management...
STL announced a fresh capex of | 200 crore to set up 9 mn Fkm optical fibre cable plant in the US and UK. Consequently, its overall optical fibre cable capacity is expected to expand from 33 mn Fkm to 42 mn Fkm. STL indicated that capacity enhancements will support extensive fibre build-outs planned across the US, Europe and UK to boost rural broadband and 5G roll outs. On the financial front, it aims to reach | 10000 crore revenue run rate by Q4FY23 (vs. | 10000 crore revenue target in FY23 earlier, given Covid led delays in services portfolio) along with net debt/equity < 0.5 and RoCE > 20%. The...
STL has indicated that OFC capacity utilisations are at 100%. It also said that optical fibre demand has revived by investments in digital infrastructure. Globally, OFC industry volumes in 2021 are likely to grow ~6% YoY. STL perceives that unprecedented decade of digital network creation is on the anvil. The company has also maintained that, going ahead, growth should be driven by growing OFC volumes, optical interconnect business, scaling up SI business (both domestically and going global) and building access solution business. We bake in revenues CAGR of ~26.6% in FY21-23E. We...
STL has indicated that capacity utilisations are at all-time high and execution on the ground for services also continues to improve on Q-o-Q basis. It has guided for continued growth in Q4FY21 on QoQ basis. It has indicated that Optical fiber demand has revived by investments in digital infrastructure. Globally, OFC Industry volumes in H22020 have grown by 5% YoY and STL volumes have grown faster than the industry high. STL perceives that unprecedented decade of digital network creation. Factors such as adoption of open source standard and software defined networking, are some of the...
We highlight that while long term target is attractive, the fibre pricing weakness persists. Moreover, we would await meaningful traction in demand before turning constructive. Post ~40% run up since our last update, we downgrade our rating to REDUCE (vs. HOLD, earlier). We value...
STL indicated that global fibre demand declined 7% YoY in 2019 (from 511 mn fkm to 477 mn fkm), on account of China slowing down after a massive 4G build. Globally most telcos have taken a capex pause and are delaying their investments. Hence, overall global fibre demand is expected to decline by 4.5% in 2020. Once the 5G investment cycle starts, demand is likely to pick up from H2FY21, with expected growth cycle of eight to 10 years. STL has decided to push the capacity expansion of OFC by six to nine months given the Covid-19 led disruption and demand challenge. The company...
STL indicated that global OFC demand came down in 2019 as China and India witnessed 13% and 29% de-growth, respectively, while North America & Europe were up 4% YoY. The company expects a demand and pricing recovery from H2FY21E onwards and has guided for an improvement in performance sequentially driven by strong services revenues and foray into new geographies. We lower our revenue forecast for FY20 to ~9% and expect FY21 revenues to witness a spurt (up 18% YoY) with new market foray that will improve capacity utilisation as well as continued network...
Sterlite Tech's performance for Q2FY20 was muted on the EBITDA front while it was weak on the PBT front given the higher depreciation and interest charges from the new optical fibre (OF) capacity that has yet to witness volume offtake. Revenues came in at | 1,360 crore, up 25.4% YoY, led by services revenues (forming 50% of topline) while product revenues were down ~16% YoY on account of demand challenges and pricing pressure. EBITDA came in at | 288.5 crore aided by slightly higher revenues. Reported EBITDA margins came in at 21.2%, a decline of 400 bps YoY. We highlight...
Sterlite Tech reported an in-line topline performance (~63% YoY growth) in Q1FY20 driven by strong domestic revenues (~64% of pie), which witnessed a staggering ~87% YoY growth. Exports revenues, on the other hand, forming 36% of revenues, grew 33% YoY. Reported EBITDA margins came in higher at 22.6% (vs. our estimate of 19.5%) given the higher proportion of product revenues that command superior margins. PAT came in lower at | 141.4 crore (vs. our expectation of | 151.2 crore) despite higher EBITDA, on account of higher depreciation and interest costs owing to...
