Financial Performance Highlights

Q2 FY27 Results:

  • Revenue: ₹2,529 crores, representing 145% year-on-year growth and 32% quarter-on-quarter growth
  • Operational EBITDA: ₹685 crores at 27.1% margin (624 basis points quarter-on-quarter expansion)
  • Reported EBITDA: ₹846 crores (includes one-time net gain of ₹161 crores from U.S. tariff refund)
  • PAT: ₹517 crores (record high)

H1 FY27 Results:

  • Revenue: ₹4,439 crores, up 116% compared to H1 FY26
  • Operational EBITDA: ₹1,082 crores at 24.4% margin
  • PAT: ₹714 crores, up from ₹14 crores in H1 FY26

Order Book and Business Momentum

  • H1 FY27 order intake: ₹32,000 crores (approximately 4x FY26 full-year orders)
  • Open order book: ₹35,274 crores (4.6x increase from ₹7,687 crores at start of FY27)
  • Q3 FY27 scheduled execution: ₹3,021 crores
  • Major wins include:
  • $1.2 billion 5-year agreement with global hyperscaler for AI-ready optical solutions
  • $1.11 billion product award letter from another hyperscaler (announced last quarter)
  • Multi-year supply agreements with major global telecom operators
  • Significant optical cable supply contract with leading Indian telecom operator

Market Position and Metrics

  • Global ex-China OFC market share: 9% in H1 FY27 (up from 7% in H1 FY26)
  • Optical connectivity attach rate: 24% in H1 FY27 (all-time high, up from 20% in H1 FY26)
  • Target: Achieve 25%+ attach rate for current financial year
  • Revenue mix by segment:
  • Data Center: 33% of H1 FY27 revenue
  • Target: Scale Data Center segment to 50% of revenues in FY27
  • Geographic revenue mix:
  • North America: 61%
  • Europe: 21%
  • Rest of World: 18%

Lakshya Growth Roadmap Update

  • FY29 revenue target: Maintained at ₹20,000 crores (4x FY26 revenue)
  • FY29 EBITDA margin target: Upgraded to 30% from 27% previously
  • Execution priorities: Shift revenue mix to high-value integrated solutions, scale data center footprint, commit 2% annual revenue to R&D, drive margin expansion through cost efficiencies

Capacity Expansion and Capex

  • Annual capex commitment: ~₹1,000 crores per year through FY29
  • Expansion plans:
  • 50% increase in preform, fiber, and cable capacities
  • New greenfield facility for pre-term related solutions

Innovation and Product Development

  • Patent portfolio: 805+ patents filed and granted (49 new filings this quarter)
  • Neuralis AI-DC portfolio enhancements:
  • Launch of high-density pre-terminated fiber trunks
  • Plenum-rated portfolio for inside data hall connectivity
  • Hollow-Core Fiber cable transitioned to first commercial pilot phase
  • Next-generation fiber technologies:
  • G.654.E fiber: Fully commercialized, 30% lower signal loss
  • Hollow Core Fiber: 30-47% lower latency, in commercial pilot phase
  • Multi-Core fiber: 4x-7x capacity expansion, deployed in India and UK

Sustainability Initiatives

  • Chhatrapati Sambhajinagar plant transitioned to 100% green power
  • Fiber carbon footprint reduced by over 80%
  • Maintained 0 waste to landfill and 0 liquid discharge standards
  • Net zero target by 2030

Balance Sheet and Credit Ratings

  • Net cash balance: ₹703 crores (improved from ₹483 crores last quarter)
  • Net debt-free company
  • Credit rating upgrades:
  • CRISIL: Long-term rating upgraded to AA stable from AA-
  • CRISIL: Short-term rating reaffirmed at A1+
  • ICRA: AA stable rating

Raw Material and Supply Chain

  • Improvement in procurement of key raw materials (germanium, helium)
  • Diversification of key raw material sources
  • Utilization rates improving quarter-on-quarter

Working Capital

  • Net working capital days: Target range of 45-50 days
  • Current slight increase in Q2 due to supply constraints
  • Focus on improving debtors and inventory levels from Q3 onwards

One-Time Items

  • U.S. tariff refund: ₹161 crores net gain (included in reported EBITDA)
  • Impairment: ₹49 crores related to Speedon Networks subsidiary
  • Additional depreciation: ₹22 crores related to impairment

Management Outlook

Management highlighted three powerful multi-year investment cycles driving growth:

1. Data Centers: Global capacity expected to grow from 82GW to 219GW by 2030, with 70% demand from AI-specific infrastructure

2. 5G/6G Networks: Global 5G subscriptions projected to reach 6.4 billion by 2031 (India: 1 billion); 6G subscriptions forecast to cross 180 million by 2031

3. FTTx: Deployments accelerating from 157 million fiber kilometers in 2025 to 166 million by 2030

Conference Call Participants

  • Management: Mr. Ankit Agarwal (Managing Director), Mr. Ajay Jhanjhari (CFO), Mr. Rahul Darak (Head of Investor Relations)
  • Analyst Participants: Representatives from Nuvama Institutional Equities, Nirmal Bang Securities, Seven Rivers, Baroda BNP Paribas Mutual Fund, Nomura, EverFlow Partners, Motilal Oswal, MK Ventures