Sterlite Technologies Limited (STLTECH) announced its Q1 FY26 financial results, showcasing a strong performance and strategic advancements:

• Financial Performance (Q1 FY26):
  • Consolidated revenue stood at ₹1019 crore, a robust 17% year-on-year growth.
  • EBITDA improved meaningfully to ₹140 crore, with margins expanding to 13.7%.
  • Profit After Tax (PAT) from continued operations was ₹10 crore, a significant turnaround from a loss of ₹48 crore in Q1 FY25.
  • The optical networking business generated ₹961 crore in revenue with an EBITDA of ₹137 crore (14.3% margin).
  • STL Digital posted ₹64 crore in revenue with an EBITDA of ₹1 crore.
  • Order intake in Q1 FY26 reached ₹1529 crore, nearly 3x from ₹566 crore in Q1 FY25 and ₹588 crore in Q4 FY25.
  • The open order book rose to ₹4,888 crore in Q1 FY26, providing solid revenue visibility.
  • Net debt was ₹1300 crore, with a debt-to-equity ratio of 0.64x and net debt to EBITDA at 2.3x, with a focus to bring it below 2x.
  • Geographically, Europe contributed 49% to revenue, while the Americas strengthened to 31%.
• Management Commentary & Outlook:
  • Ankit Agarwal, MD, STL, highlighted the strategic priorities: driving growth in optical fiber cables, improving connectivity attach rates, expanding the product portfolio for AI-enabled data centers, and achieving technology and cost leadership.
  • He noted the market demand for optical fiber is poised for a turnaround in 2025, with prices having stabilized and bottomed out.
  • The company aims to improve EBITDA margins to 18-20% by increasing capacity utilization towards 70%.
  • Ajay Jhanjhari, CFO, mentioned that finance costs have consistently decreased due to debt reduction and are expected to reduce by another 5-6% going forward.
• Strategic Highlights & Innovations:
  • The company secured a three-year long-term contract with a leading European telecom player and strong inflows from top-tier North American telecom operators.
  • STL launched its next-generation data center portfolio (STS) and India's first multi-core fiber, offering 4-7x capacity, ideally suited for AI data centers and 5G networks.
  • The company's innovation engine remains strong with 740 patents.
  • Global optical fiber demand is projected for a turnaround in 2025, with North America and Europe leading the resurgence. India's data center capacity is expected to grow 4x by 2028, supported by over ₹65,000 crore in planned investments.
  • STL's market share in the global OFC market (outside China) improved to 7% from 6% in Q1 FY25.
  • STL Digital added four marquee clients, bringing the total to 30 global customers, and signed multi-year contracts with two leading healthcare providers in the Middle East, focusing on profitable growth.
• Demerger Update:
  • STL Networks Limited is now a separate legal entity, with its shares expected to be listed by the end of August 2025, following NCLT approval in February 2025.