HFCL Ltd, a diverse telecom infrastructure enabler had their Q3 FY 22 con-call today at 1:00pm.
“Intensifying global footprint to capitalize on demand.”
Here are the key takeaway’s…
“Intensifying global footprint to capitalize on demand.”
Here are the key takeaway’s…
Business update
- Company has gained the largest market share in OFC supplies in India.
- They are the largest producers of Wi-Fi/UBR systems in India.
- Along that, they are one of the largest implementations of defence communications network.
- Company has gained the largest market share in OFC supplies in India.
- They are the largest producers of Wi-Fi/UBR systems in India.
- Along that, they are one of the largest implementations of defence communications network.
- The company is building a dedicated standard optical MPLS based network for Indian armed forces with a contract value of USD 1.11 bb.
- Their long standing relationship and wide global presence has gained them a lot of cost effective solutions and tech agility.
- Their long standing relationship and wide global presence has gained them a lot of cost effective solutions and tech agility.
- The company is also engaged in an green field defence equipment production facility to support make in India.
- They are also setting up an dedicated unit to facilitate global 5g communications.
- The company had increased its promoter range by adding new talent as well.
- They are also setting up an dedicated unit to facilitate global 5g communications.
- The company had increased its promoter range by adding new talent as well.
Project pipeline
- Under public telecom space the company has rolled out OFC and FTTH network for JIO across northern India.
- They are currently working on multiple hybrid projects for Bharat net phase-2 OFC network.
- They currently have an order book of around 1700 cr
- Under public telecom space the company has rolled out OFC and FTTH network for JIO across northern India.
- They are currently working on multiple hybrid projects for Bharat net phase-2 OFC network.
- They currently have an order book of around 1700 cr
- In Defence space, Company is engage in planning, design and implementation of nationwide IP backbone and access network.
- They are focused towards developing hybrid microwave broadband radio links in remote areas. And CCTV surveillance for 300+ army locations.
- They are focused towards developing hybrid microwave broadband radio links in remote areas. And CCTV surveillance for 300+ army locations.
- They have an order book of around 2400 cr
- Under railway communications, company is developing integrated communications network for metros and has began implementing video monitoring system at 600 railway stations.
- They had order book of 500 cr approx.
- Under railway communications, company is developing integrated communications network for metros and has began implementing video monitoring system at 600 railway stations.
- They had order book of 500 cr approx.
- Combining all opportunities all together they expect USD 50 Bn spending to occur in telecommunications space in next 5 years.
- And about 70bn in defence communications and electronics for next 12 years.
- This is driven by import reduction and increase FDI limit.
- And about 70bn in defence communications and electronics for next 12 years.
- This is driven by import reduction and increase FDI limit.
- With support of digital India and more focus on innovative areas they aim to increase their revenues with entry in higher margin products.
- And extend their market reach by export to 30+ counties and recruiting international sale talent as well.
- And extend their market reach by export to 30+ counties and recruiting international sale talent as well.
- They are more focused towards high margin product led growth.
- Shifting Project:product ratio of 73:27 to 59:41.
- Capacity utilisation are at optimal levels at all manufacturing locations.
- Shifting Project:product ratio of 73:27 to 59:41.
- Capacity utilisation are at optimal levels at all manufacturing locations.
Financials
- At present, company generates 55% of its revenue from public telecommunications.
- 42% from defence communications and electronics.
- And rest from Railway communications.
- At present, company generates 55% of its revenue from public telecommunications.
- 42% from defence communications and electronics.
- And rest from Railway communications.
- During the Period, company has witnessed a fall in its revenue compared to Q3 FY21.
- But were able to sustain and increased their EBITDA & EBITDA margins on yoy basis. But have seen a negative change on QoQ basis.
- Same thing is experienced in PAT levels.
- But were able to sustain and increased their EBITDA & EBITDA margins on yoy basis. But have seen a negative change on QoQ basis.
- Same thing is experienced in PAT levels.
- They had raised 600 crs via qip and this will be used for caped, RnD and other business purposes.
- They have released 100% of pledge of promoters shares.
- Gaining PLI approval for manufacturing telecom and networking products, with innovation edge will boost results.
- They have released 100% of pledge of promoters shares.
- Gaining PLI approval for manufacturing telecom and networking products, with innovation edge will boost results.
- Incorporation of 2 new subsidiaries will help them capture new markets and increase their range as well.
- In last 9 months major shift in range has been beneficial and will bring positive results for us in future as well.
- In last 9 months major shift in range has been beneficial and will bring positive results for us in future as well.
- The company has also entered into equal partnership to attain more technological edge in launching new products necessary for defence and other spaces.
- Company is stuck in various tasks which can be only conducted post govt work is done.
- Company is stuck in various tasks which can be only conducted post govt work is done.
-In relations to debt, major loan still there is of working capital and rest 40% concludes term loan.
-The company targets to remove them as soon as possible.
-There has been an increase in raw materials cost of OFC and logistics as well. So product prices might increase more.
-The company targets to remove them as soon as possible.
-There has been an increase in raw materials cost of OFC and logistics as well. So product prices might increase more.
- This price increase is also due to low semiconductor supply.
- The net working capital is around 95 days and will improve with milestones completion as the receivables will come down by a huge level.
- The net working capital is around 95 days and will improve with milestones completion as the receivables will come down by a huge level.
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