Sify Technologies Limited 2027 Q2 Earnings Call

Thank you, Matthew. I would like to extend a warm welcome to all our participants on behalf of Sify Technologies Limited. I am joined on the call today by Raju Vegesna, Chairman, and M P Vijay Kumar, Executive Director and Group CFO of Sify Technologies. Following our comments on the results, there will be an opportunity for questions. If you do not have a copy of our press release, please call Luri Group at 1-646-824-2856 and we will have one sent to you. Alternatively, you may obtain a copy of the release at the investor information section on the company's corporate website. A replay of today's call may be accessed by dialing in on the numbers provided in the press release or by accessing the webcast in the investor information section. Some of the financial measures referred to during this call and in the earnings release may include non-GAAP measures.

Sify's results for the year and the quarter are according to the International Financial Reporting Standards, or IFRS, and will differ somewhat from the GAAP announcements made in previous years. A presentation of the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of such non-GAAP measures, and of the differences between such non-GAAP measures and the most comparable financial measures that is presented in accordance with GAAP will be made available on Sify's website. Before we continue, I would like to point out that certain statements contained in the earnings release and on this conference call are forward-looking statements rather than historical facts and are subject to risks and uncertainties that could actually cause results to differ materially from those described. With respect to such forward-looking statements, the company seeks protection afforded by the Private Securities Litigation Reform Act of 1995.

These risks include a variety of factors, including competitive developments and risk factors listed from time to time in the company's SEC reports and public documents. Those lists are intended to identify certain principal factors that could cause actual results to differ materially from those described in the forward-looking statements, but are not intended to represent a complete list of all risks and uncertainties inherent to the company's business. Allow me to turn this over to Mr. Raju Vegesna, Chairman of Sify Technologies.

Chairman. Thank you, Praveen. Good morning, everyone, and thank you for joining on the call.

India's digital transformation is entering into a new phase of execution at scale. What was once a digital transformation agenda has now becoming a business imperative, with organizations investing in technology to improve productivity, resilience, and the customer experience. India continues to benefit from unique combination of progressive policy initiatives, expanding digital infrastructure, and a deep pool of technology talent. As AI adoption gathers pace and the need of secure, scalable, and interconnected digital infrastructure will become even more critical. This presents a significant opportunity for India to strengthen its position as a global technology and innovation hub. At Sify, we continue to align our investments with these long-term trends. Our integrated portfolio of data centers, network, and digital services enables us support customers as they modernize their technology environment and prepare for an AI-enabled future.

India is no longer preparing for a digital future. It is actually actively shaping it. Sify remains committed to building the infrastructure and capabilities that will help power this next chapter of India's growth. Let me now bring our Executive Director and Group CFO, Mr. M P Vijay Kumar, to explain both the business and financial highlights.

Vijay Kumar. Thank you, Chairman.

We continue to strengthen our business through sustained investments in infrastructure, technology platforms, and people, aligned with the evolving needs of our customers and the long-term opportunities in India's digital economy. Our investment priorities remain focused on expanding our data center capacity, modernizing our network infrastructure for AI workloads, enhancing our cloud interconnect capabilities, and strengthening the tools and platforms that support operational efficiency and customer delivery. Equally, we continue to invest in developing our people, building the skills and capabilities required to support emerging technologies and deliver consistent outcomes across our businesses. These investments are being pursued alongside a continued emphasis on cost competitiveness, resource optimization, and cash flow management. While capacity expansion and capability building have implications for depreciation, interest, and manpower costs, we remain focused on ensuring that capital allocation is supported by sound financial planning, prudent risk management, and long-term business objectives.

Our priority is to maintain a strong balance sheet and adequate financial flexibility while investing for sustainable growth and creating enduring value for our shareholders. Let me now expand on the business highlights for the quarter. The revenue split between the businesses for the quarter was network services 43%, data center services 37%, and digital services 20%. As of September 30, 2026, data center operational capacity stood at 136 megawatts, and we have a contracted capacity of 113 megawatts scheduled for delivery. As of September 30, 2026, Sify provides services via 1,264 fiber nodes across the country, a 6% increase over the same quarter last year. A detailed list of our wins is recorded in our press release, now live on our website. Let me briefly sum up the financial performance for Q2 of FY 2026-27.

Revenue was INR 13,798 million, an increase of 31% over the same quarter last year. Adjusted EBITDA was INR 3,131 million, an increase of 33% over the same quarter last year. Profit for the quarter was INR 40 million. Capital expenditure during the quarter was INR 8,573 million. Cash balance at the end of the quarter was INR 5,868 million. I will now hand over to our Chairman for his closing remarks.

Chairman? Thank you, Vijay Kumar.

Sify is well-positioned to support India's digital transformation and the opportunities emerging from an increasingly connected and AI-driven future. As India's digital transformation advances, we remain committed to enabling this journey through our technology capabilities, infrastructure, and services, while creating long-term value for all our stakeholders. I thank you all our stakeholders for their continued trust and confidence as we work towards this future. Thank you for joining us on the call. I now hand over to the operator for the questions.