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After Weak Q3, Sterlite Tech Expects New Orders, Services Arm To Bolster Q4

Sterlite Tech expects demand for its fibre and cable arms to recover in the next three quarters on the back of 5G trials worldwide

Green LED lights and rows of fibre optic cables are seen feeding into a computer server. (Photographer: Simon Dawson/Bloomberg)
Green LED lights and rows of fibre optic cables are seen feeding into a computer server. (Photographer: Simon Dawson/Bloomberg)

WATCH | Sterlite Tech CFO Anupam Jindal on the company’s Q3 Results

Sterlite Technologies Ltd. expects its order book visibility and services segment to result in an “overall bright” fourth quarter.

“We see the third quarter as our lowest point (in terms of performance) in recent times,” the company’s Chief Financial Officer Anupam Jindal told BloombergQuint in an interview. “Our order book stood at Rs 8,500 crore at the end of the quarter and we’re expecting annual revenue growth of 40-50 percent in the fiscal year ended 2021.”

That comes as the communications equipment maker’s profit more than halved to Rs 50 crore in the three months ended December. The company said that it suffered an exceptional loss of Rs 51 crore due to an additional provision following its application to resolve a legacy dispute.

Jindal also said Sterlite Tech’s fibre and cable segments may witness recovery in demand over the next three quarters on account of 5G trials happening worldwide. Union Telecom Minister Ravi Shankar Prasad announced last month the government will allocate airwaves to all service providers for conducting trials of super-fast speed 5G networks.

Sterlite Tech Q3 Results 2019-20: Key Highlights

  • Revenue fell 11.5 percent at Rs 1202.7 crore.
  • Net profit fell 68.3 percent to Rs 50 crore.
  • Ebitda declined 16.3 percent to Rs 241.4 crore.
  • Operating margin at 20.1 percent versus 21.2 percent.
  • Exceptional loss of Rs 51 crore.
  • Order Book at Rs 8,535 crore versus Rs 8,132 crore.

On Thursday, Sterlite Tech shares fell 5.06 percent to Rs 124.70 apiece on the NSE while the benchmark Nifty 50 gained 0.09 percent to end the day at 12,356.25 points.