Q1 2027 Sify Technologies Limited Earnings Call

July 15, 2026

Speaker #1: Greetings. Welcome to the Sify Technologies financial results for Q1 FY 2026 and 2027. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation.

Operator: Greetings. Welcome to the Sify Technologies financial results for Q1 FY 2027 and 2027. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I would now like to turn the conference over to your host, Praveen Krishna. You may begin.

Speaker #1: If anyone should require operator assistance during the conference, please press *0 on your telephone keypad. Please note, this conference is being recorded. I would now like to turn the conference over to your host, Praveen Krishna.

Speaker #1: You may begin.

Speaker #2: Thank you, Holly. I would like to extend a warm welcome to all our participants on behalf of Sify Technologies Ltd. I'm joined on the call today by my Chairman, Mr. Raju Vegesna, and my Executive Director and Group CFO, Mr. M.

Praveen Krishna: Thank you, Holly. 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 my Chairman, Mr. Raju Vegesna, and my Executive Director and Group CFO, Mr. M P Vijay Kumar. Following our comments on the results, there'll be an opportunity for questions. If you do not have a copy of our press release, please call The Lurie Group at 16468242856 and we'll 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 at www.sifytechnologies.com/investors. 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 of the Sify corporate website.

Speaker #2: P. Vijaykumar: 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 Lurie Group at 1-646-824-2856, and we'll have one sent to you.

Speaker #2: Alternatively, you may obtain a copy of the release in the Investor Information section on the company's corporate website at www.sifytechnologies.com/investors. A replay of today's call may be accessed by dialing the numbers provided in the press release, or by accessing the webcast in the Investor Information section of the Sify corporate website.

Speaker #2: 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 are according to IFRS and will differ somewhat from the GAAP announcements made in previous years.

Praveen Krishna: 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 are according to the 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 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 cause actual results to differ materially from those described.

Speaker #2: The presentation of the most directly comparable financial measures calculated and presented in accordance with GAAP, and a reconciliation of such non-GAAP measures and the differences between such non-GAAP measures and the most comparable financial measures, is presented in accordance with GAAP and will be made available on Sify's website.

Speaker #2: 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.

Speaker #2: Rather than historical facts, these statements are subject to risks and uncertainties that could cause actual results to differ materially from those described. With respect to such forward-looking statements, the company seeks the protection afforded by the Private Securities Litigation Reform Act of 1995.

Praveen Krishna: 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 releases. 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. I would now like to introduce my Chairman, Mr. Raju Vegesna. Chairman?

Speaker #2: 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 releases.

Speaker #2: Those risks 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.

Speaker #2: I would now like to introduce my Chairman, Mr. Raju Vegasinna. Chairman.

Speaker #3: Thank you, Praveen. Good morning, everyone. Thank you for joining us on the call. India's digital transformation is entering a phase of execution at scale.

Raju Vegesna: Thank you, Praveen. Good morning, everyone. Thank you for joining us on the call. India's digital transformation is entering a phase of execution at scale. What was once a digital transformation agenda has now become a business imperative, with organizations investing in technology to improve productivity, resilience, and customer experience. The country continues to benefit from a unique combination of progressive policy initiatives, expanding digital infrastructure, and a deep pool of technology talent. As AI adoption gathers pace, the need for 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 lab. 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 to support customers as they modernize their technology environments and prepare for an AI-enabled future.

Speaker #3: What was once a digital transformation agenda has now become a business imperative, with organizations investing in technology to improve productivity, resilience, and customer experience.

Speaker #3: The country continues to benefit from a unique combination of progressive policies and initiatives, expanding digital infrastructure, and a deep pool of technology talent. As AI adoption gathers pace, the need for secure, scalable, and interconnected digital infrastructure will become even more critical.

Speaker #3: This presents a significant opportunity for India to strengthen its position as a global technology and innovation lab. 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 to support customers as they modernize their technology environments and prepare for an AI-enabled future.

Speaker #3: India is no longer preparing for the digital future. It is. Sify remains committed to building the infrastructure and capabilities that will help power this next chapter of growth.

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

Speaker #3: Let me now bring our Executive Director and Group CFO, Mr. M. P. Vijaykumar, to explain both the business and financial highlights of this quarter.

Speaker #3: Vijay?

Speaker #4: Yes, thank you, Chairman. During the quarter, we continued to strengthen the operational foundation of our businesses. Through disciplined execution, improved resource utilization, and targeted investments across each of our portfolios, we continued to invest in capacity expansion, network modernization, and technology platforms that position us to address emerging demand from AI, cloud, and data-intensive workloads.

M P Vijay Kumar: Thank you, Chairman. During the quarter, we continued to strengthen the operational foundation of our businesses through disciplined execution, improved resource utilization, and targeted investments across each of our portfolios. We continue to invest in capacity expansion, network modernization, and technology platforms that position us to address emerging demand from AI, cloud, and data-intensive workloads. At the same time, we remain vigilant in managing costs, optimizing cash flows, and enhancing operational efficiency across the organization. While investment in infrastructure and talent continue to influence depreciation, interest, and people cost, these are aligned with our long-term growth objective and supported by a prudent approach to risk management and financial planning. Our priority remains unchanged, maintaining a strong balance sheet, preserving financial flexibility, and creating enduring value for shareholders through disciplined growth and responsible stewardship of capital. Let me now expand on business highlights for the quarter.

Speaker #4: At the same time, we remain vigilant in managing costs, optimizing cash flows, and enhancing operational efficiency across the organization. While investment in infrastructure and talent continues to influence depreciation, interest, and people costs, these are aligned with our long-term growth objectives and are supported by a prudent approach to risk management and financial planning.

Speaker #4: Our priority remains unchanged: maintaining a strong balance sheet, preserving financial flexibility, and creating enduring value for shareholders through disciplined growth and responsible stewardship of capital.

Speaker #4: Let me now expand on business highlights for the quarter. The revenue split between the three businesses for the quarter was: Network Services, 39%; Data Center Co-location Services, 42%; and IT Digital Services, 19%.

M P Vijay Kumar: The revenue split between the three businesses for the quarter was Network Services 39%, Data Center colocation services 42%, and IT Digital Services 19%. The data center subsidiary sold 5 MW of capacity in the quarter, and as of 30 June 2026, Sify provides Network Services via 1,238 fiber nodes across the country, a 7% increase over the same quarter last year. A detailed list of our key wins is recorded in our press release, now live on our website. Let me briefly sum up the financial performance for Q1 of FY 2026-2027. Revenue was INR 12,352 million, an increase of 15% over the same quarter last year. Adjusted EBITDA was INR 3,005 million, an increase of 42% over the same quarter last year. Profit for the quarter was INR 65 million. Capital expenditure during the quarter was INR 6,708 million.

Speaker #4: The data center subsidiary sold 5 megawatts of capacity in the quarter, and as of June 30, 2026, Sify provides network services via 1,238 fiber nodes across the country, a 7% increase over the same quarter last year.

Speaker #4: A detailed list of our key wins is recorded in our press release, now live on our website. Let me briefly sum up the financial performance for quarter one, our financial year 2026-27.

Speaker #4: Revenue was INR 1,235.2 million, an increase of 15% over the same quarter last year. Adjusted EBITDA was INR 3,005 million, an increase of 42% over the same quarter last year.

Speaker #4: Profit for the quarter was INR 65 million. Capital expenditure during the quarter was INR 6,708 million. Cash balance at the end of the quarter was INR 4,597 million.

M P Vijay Kumar: Cash balance at the end of the quarter was INR 4,597 million. I will now hand over to our Chairman for his closing remarks. Chairman?

Speaker #4: I will now hand over to our Chairman for his closing remarks. Chairman.

Speaker #3: Thank you, Vijaykumar. With our integrated portfolio of services, Sify is well-positioned to support enterprises as they build resilient, scalable, and future-ready digital ecosystems. I would like to express my sincere gratitude to our customers, shareholders, partners, employees, and all other stakeholders for their continued trust, support, and confidence in Sify.

Raju Vegesna: Thank you, Vijayakumar. With our integrated portfolio of services, Sify is well-positioned to support enterprises as they build resilient, scalable, and future-ready digital ecosystems. I would like to express my sincere gratitude to our customers, shareholders, partners, and employees, and all other stakeholders for their continued trust, support, and confidence in Sify. Together, we remain committed to contributing to India's digital future and capturing the opportunities that lie ahead. Thank you for joining on this call. I will now hand over to the Operator for questions. Operator?

Raju Vegesna: Thank you, Vijay Kumar. With our integrated portfolio of services, Sify is well-positioned to support enterprises as they build resilient, scalable, and future-ready digital ecosystems. I would like to express my sincere gratitude to our customers, shareholders, partners, and employees, and all other stakeholders for their continued trust, support, and confidence in Sify. Together, we remain committed to contributing to India's digital future and capturing the opportunities that lie ahead. Thank you for joining on this call. I will now hand over to the Operator for questions. Operator?

Speaker #3: Together, we remain committed to contributing to India's digital future and capturing the opportunities that lie ahead. Thank you for joining on this call. I will now hand over to the operator for questions.

Speaker #3: Operator?

Speaker #5: Certainly. At this time, we will be conducting a question-and-answer session. If you would like to ask a question, please press star 1 on your telephone keypad.

Operator: Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Your first question for today is from Greg Burns with Sidoti & Company.

Speaker #5: A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue.

Speaker #5: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

Speaker #5: Your first question for today is from Greg Burns with Cidodian Company.

Speaker #6: Good morning. Do you have an update on the potential timing for the Sify Infinite Spaces IPO?

Greg Burns: Good morning. Do you have an update on the potential timing for the Sify Infinit Spaces IPO?

Speaker #2: Yeah. As far as the IPO timing is concerned, the bankers are actively evaluating the right time when the market appetite will be good and will appreciate the quality of the asset we are.

M P Vijay Kumar: Yeah. As far as the IPO timing is concerned, the bankers are actively evaluating the right time where the market appetite will be good and will appreciate the quality of the asset we are

Speaker #2: From the company's side, we stay ready for listing once the bankers advise on going ahead.

Raju Vegesna: From the company's side, we stay ready for listing once the bankers advise us on going ahead.

Speaker #6: Okay, thank you. And then you mentioned you sold 5 megawatts of capacity in the quarter. How much capacity is currently live and operational, and what is your current design capacity of existing data centers?

Greg Burns: Okay. Thank you. You mentioned you sold 5MW of capacity in the quarter. How much capacity is currently live and operational, and what is your current design capacity of existing data centers?

Speaker #2: Yeah.

Greg Burns: Yes.

Speaker #6: And then, maybe, can you give us an update on what you expect to go live, or how much capacity is currently under construction and, I guess, expected to become operational over the next 12 months?

Greg Burns: Maybe can you give us an update on what you expect to go live or how much capacity is currently under construction and I guess expected to become operational over the next 12 months? Thank you.

Speaker #6: Thank you.

Speaker #2: Yeah. So the capacity which is designed and ready is 188 megawatts. The operational, live, revenue-generating capacity is 134 megawatts. And the capacity which will get delivered in this fiscal will be about 100 megawatts.

Raju Vegesna: Yeah. The capacity which is designed and ready is 188MW. The operational live revenue generating capacity is 134MW, the capacity which will get delivered in this fiscal will be about 100MW. There is another 150MW of capacity under construction.

Speaker #2: And there is another 150 megawatts of capacity under construction.

Speaker #6: Okay, okay. So, do you expect the capex to remain at the level you had in this first quarter for the remainder of the year, or is it going to maybe ramp up from here?

Greg Burns: Okay. Do you expect the CapEx to remain at the level you had this Q1 for the remainder of the year or is it going to maybe ramp up from here?

Speaker #2: The CapEx is likely to be higher for the remaining part of this year, as we get ready to deliver capacity for the customers.

Raju Vegesna: The CapEx is likely to be higher for the remaining part of this year as we get ready to deliver capacity for the customers.

Speaker #6: Okay. And can you just maybe give us your thoughts on what are the primary differentiators for Sify? Why is Sify winning in the market?

Greg Burns: Okay. Can you just maybe give us your thoughts on what are the primary differentiators for Sify? Why is Sify winning in the market? Maybe what are the reasons that you think that Sify differentiates itself and how you're driving success?

Speaker #6: Maybe, what are the reasons that you think SIFY differentiates itself, and how are you driving success?

Speaker #3: No, I think there is some uniqueness with our presence in the market for more than 20 years, and with the existing hyperscalers and enterprises.

Raju Vegesna: Now, I think there is some uniqueness in the market presence for about the time of more than 20 years, existing hyperscalers and the enterprises. That makes us different. Also our presence in all our key markets like Mumbai, Chennai, Noida, Hyderabad, Bangalore, and small portion in Kolkata. That makes us a unique position. Also our having a network around our data centers, connectivity availability. It's not any one-time kind of thing because the way the Sify portfolio has all these things, also we have cable landing stations we are building. As an integrated player, complete having a data centers network and having a good power availability story, that will help to win such kind of data center deals.

Speaker #3: That makes us different. And also, our presence in all our key markets—like Mumbai, Chennai, Noida, Hyderabad, Bengaluru, and a small portion in Calcutta—that makes us unique.

Speaker #3: Position. And And also, our having a network around our data centers, connectivity, availability, so it is not a any one-time kind of thing. Because the way the SIFY portfolio has all these things and also we have cable landing stations, we are building so as an integrated player, complete having a data centers network and having a good power availability story, that will help to win such kind of data center deals.

Greg Burns: All right. Thanks. Then, I know you're in all the major hubs, what is the opportunity for edge capacity building out data centers in smaller markets? Is there an opportunity there for you and is that currently on your roadmap?

Speaker #6: All right. Thanks. And then I know you're in all the major hubs, but what is the opportunity for edge capacity, building out data centers in smaller markets or is there an opportunity there for you?

Speaker #6: And is that currently on your roadmap?

Speaker #3: Yeah. We already have an opportunity there. We have already completed two such data centers in Lucknow and Chandigarh, and we are also constructing two more. So, we have a plan to build across India, in Tier 2 and Tier 3 cities, about 10 to 12 edge data centers over the next few years.

Raju Vegesna: Yeah. We have already opportunity there. We already completed two such data centers, each Lucknow and Chandigarh, we are also constructing two more. We are having a plan about building across India in tier 2, tier 3 cities, about 10 to 12 edge data centers over the next few years. These opportunities, because India not only depending upon the six major metro cities, but these secondary cities are also very important. Our presence, we are building strategically two, three edge data center per year. That's what we are looking at.

Speaker #3: So these opportunities, because India is not only depending upon these six major metro cities, but these secondary cities are also very important. So our presence—we are building strategically two to three edge data centers per year.

Speaker #3: That's what we are looking at.

Greg Burns: Okay. All right. Thank you very much.

Speaker #6: Okay. All right. Thank you very much.

Speaker #3: Thank you.

Raju Vegesna: Thank you.

Speaker #5: Your next question for today is from Patek Singh with IIFL Capital.

Operator: Your next question for today is from Prateek Singh with IIFL Capital.

Speaker #2: Hi, Pratik.

Raju Vegesna: Hi, Prateek.

Speaker #4: Hello. Hi. Thank you for the opportunity. I understand that the sold capacity has now gone to 134. The installed capacity, which was 140 at the end of FY26—what would that number be?

Prateek Singh: Hello. Hi. Hi sir. Thanks for the opportunity. I understand that the solar capacity has now gone to 134. The installed capacity which was 140 end of FY26, what would that number be?

Prateek Singh: Hello. Hi. Hi sir. Thanks for the opportunity. I understand that the solar capacity has now gone to 134. The installed capacity which was 140 end of FY 2026, what would that number be?

Speaker #2: 154.

Raju Vegesna: 154.

Speaker #4: Okay. And the design capacity has been at 188 megawatts for 45 quarters now. So I just wanted to understand, how does it work? Do we first focus on completing the installed capacity, and then build new capacity?

Prateek Singh: Okay. The design capacity has been at 188 megawatts for four, five quarters now. I just wanted to understand how does it work. We first focus on completing the installed capacity and then build new capacity or both of these cannot be done parallelly?

Speaker #4: Or can both of these not be done in parallel?

Speaker #2: Yeah. I was answering the previous speaker. There is another 100 megawatts of capacity, which coincidentally will be both design and installed capacity, which will be delivered this year.

Raju Vegesna: Yeah. I was answering the previous speaker. There is another 100 megawatt of capacity, which coincidentally will be both design plus installed capacity, which will be delivered this year. Another 150 megawatt of capacity, which is under construction.

Speaker #2: And another 150 megawatts of capacity, which is under construction.

Speaker #4: Okay. So can we assume that from a sold capacity of 134 right now, revenue-generating capacity next year would be somewhere in the range of 220 to 230 for the entire year?

Prateek Singh: Okay. Can we assume that from a solar capacity of 134 right now, revenue generating capacity next year would be somewhere in the range of 220, 230 for the entire year?

Speaker #2: Yeah, it should be north of that.

M P Vijay Kumar: Yeah, it should be north of that.

Speaker #4: Understood. Understood. And my second question is, by when will this 81 megawatts that we signed last quarter—by when will this start to generate revenue?

Prateek Singh: Understood. My second question is, by when will this 81 MW that we signed last quarter, by when will this start to generate revenue?

Speaker #2: It will start generating from the end of quarter two, but it will reflect significantly in Q3 and Q4.

M P Vijay Kumar: It'll start generating from end of Q2, but it'll reflect significantly in Q3 and Q4.

Speaker #4: Understood. Understood. And about margins, so our revenue has risen on a quarter-on-quarter basis, but gross profit has come down. Seems to be driven by the data center business, where revenue has risen 10% on a QOQ basis, but EBITDA is largely flat at around ₹2,292 million.

Prateek Singh: Understood. About margins, our revenue has risen on a quarter-on-quarter basis, but gross profit has come down. Seems to be driven by the data center business where revenue has risen 10% on a QOQ basis, but EBITDA is largely flat at around INR 2,292 million. Margins there have fallen from 45% EBITDA margin to 43%. Is this the new normal, any one-offs that we saw this quarter in data center business? How should we look at it?

Prateek Singh: Understood. About margins, our revenue has risen on a quarter-on-quarter basis, but gross profit has come down. Seems to be driven by the data center business where revenue has risen 10% on a Q-on-Q basis, but EBITDA is largely flat at around INR 2,292 million. Margins there have fallen from 45% EBITDA margin to 43%. Is this the new normal, any one-offs that we saw this quarter in data center business? How should we look at it?

Speaker #4: So margins there have fallen from 45% EBITDA margin to 43%. So is this the new normal? Any one-offs that we saw this quarter in the data center business?

Speaker #4: Or how should we look at it?

Speaker #2: It is essentially a one-off, which is there in the context of some power tariff revision. Which has taken place for one of the facilities.

M P Vijay Kumar: It is essentially a one-off, which is there in the context of some power tariff revision, which has taken place for one of the facilities.

Speaker #4: Okay. And it is something which we cannot pass on to our customers?

Prateek Singh: Okay. It is something which we cannot pass it on to our customers?

Speaker #2: We are working with the customer, so in case it happens, it will reflect later. But from a conservative and accounting requirement perspective, we have taken it into cost.

M P Vijay Kumar: We are working with the customer, so in case it happens, it'll reflect later. From a conservative and accounting requirement perspective, we have taken it into cost.

Speaker #4: Understood. And just one last clarification—in the last results press release, FY26 end equity was around 25 billion rupees. Sorry, yeah, 25—24,994 million rupees.

Prateek Singh: Understood. Just one last clarification. In the last results press release, FY26 end equity was around INR 25,249.94 million, which has now changed to INR 18,933. Is it just a rectification or was there any reclassification or any kind of an equity-debt conversion?

Speaker #4: Which is now changed to 18,933. Is it just a rectification, or was there a reclassification, or any kind of equity-debt conversion?

Speaker #2: No. Can you repeat? Equity figure.

M P Vijay Kumar: Can you repeat the equity figure?

Speaker #4: Yeah. The equity figure that you gave—in the end, equity, borrowings, long-term, short-term, cash balance, net debt. So the equity number in April, when you reported your March-end results, the March-end number at that point of time was 24,994 in the press release, which has now changed to 18,933.

Prateek Singh: Yeah, the equity figure that you gave, in the end, equity borrowings, long-term, short-term, cash balance, net debt. The equity number in April, when you reported your March end results, the March end number at that point of time was INR 24,994 in the press release, which has now changed to INR 18,933. Wanted to check, is it just a rectification or any kind of a reclassification which has happened?

Speaker #4: Wanted to check, is it just a rectification or any kind of reclassification which has happened?

Speaker #2: Let me check on that. To my knowledge, it is a reclassification on the consolidated side. The CCDs, which are the compulsory convertible debentures that the parent company was holding in the subsidiary, we took the final accounting position that we will treat it as debt until the listing happens.

M P Vijay Kumar: Let me check on that. To my knowledge, it is a reclassification on the consolidated side. The CCDs which were there, the Compulsory Convertible Debentures, which the parent company was holding in the subsidiary. We took the final accounting position that we will treat it as debt until the listing happens. That's the difference between the two.

Speaker #2: So that's the difference between the two.

Speaker #4: Understood. Understood. Thanks. I'll join back the queue.

Prateek Singh: Understood. Thanks. I'll join back the queue.

Speaker #2: Welcome.

M P Vijay Kumar: Welcome.

Speaker #5: Once again, if you would like to ask a question, please press star one. You have a follow-up question coming from Pratik Singh. Your line is live.

Operator: Once again, if you would like to ask a question, please press star one. You have a follow-up question coming from Prateek Singh. Your line is live.

Speaker #4: So, thanks for the opportunity again. So, any ones in the interim—like one of your nearest peers recently raised capital via a private round.

Prateek Singh: Thanks for the opportunity again. Any plans in the interim, like one of your nearest peers recently raised capital via a private round. Any plans of that if the IPO proceedings get delayed? The IPO is our primary target right now and no plans for any kind of a private round as of now?

Speaker #4: Are there any plans in case the IPO proceedings get delayed? Or is the IPO our primary target right now, with no plans for any kind of private round as of now?

Speaker #2: No, we have Kotak supporting us on equity for the growth, so we are pursuing the IPO path. Any capital requirement, in the unlikely situation of the IPO getting delayed, Kotak will step in.

M P Vijay Kumar: No, we have Kotak supporting us on equity for the growth. We are pursuing the IPO path, and any capital requirement in the unlikely situation of IPO getting delayed, Kotak will step in.

Speaker #4: Okay, so given your CapEx is quite high—I mean, it is almost double the quarterly rate that we used to see earlier—because you are on a very strong growth path.

Prateek Singh: Okay. Given your CapEx is quite high, I mean, it has shot up almost double the quarterly rate that we used to see earlier because you are on a very strong growth path. As you said, it would remain, the run rate may be even higher in the next three quarters. There might be a case where we may need funding, if the IPO does not happen by then. In that case, you're saying that the Kotak will be happy to support.

Speaker #4: And as you said, it would remain at the current level, maybe even higher, in the next three quarters. There might be a case where we may need funding if the IPO does not happen by then.

Speaker #4: So, in that case, you're saying that Kotak will be happy to support.

Speaker #2: Correct. Correct. Correct. Correct. Correct. They have offered to stay committed to the growth of the company, so they will step in. But even otherwise, there are several other strategic investors who have shown keen interest.

M P Vijay Kumar: Correct. They have offered to stay committed to the growth of the company, they will step in. Even otherwise, there are several other strategic investors who have shown keen interest. We will evaluate when it is necessary.

Speaker #2: But we will evaluate when it is necessary.

Speaker #4: Understood. And the final question on my side is on Sify Technologies. So, how should we look at the digital services business this time? Also, it was a negative EBITDA.

Prateek Singh: Understood. The final question on my side is on Sify Technologies. How should we look at the Digital Services business? This time, also it was a -EBITDA. While I understand that it may remain -EBITDA for quite some time. In terms of revenue also, we saw a decline on a year-on-year basis and also on a QOQ basis. What kind of a growth path do we see for digital? By when can we expect an EBITDA breakeven there?

Speaker #4: I understand that it may remain a negative EBITDA for quite some time. But in terms of revenue also, we saw a decline on a year-on-year basis and also on a QOQ basis.

Speaker #4: So what kind of growth path do we see for digital? Or by when can we expect an EBITDA break-even there?

Speaker #2: Yeah. So, as far as the revenue growth is concerned, we may not see too much growth because we are focusing more on services revenue versus project-based revenue.

M P Vijay Kumar: Yeah. As far as the revenue growth is concerned, we may not see too much of a growth because we are focusing more on services revenue versus project-based revenue. On the EBITDA side, we are all working for reduction of the losses quarter-on-quarter basis. There is active guidance from the board as well in terms of getting it to path of profitability soon. A lot of work is happening. I'm not in a position to communicate to you the specific steps, but we continue to stay focused, and you can actually see the result of our efforts in terms of the reduction in loss at EBITDA level vis-à-vis the previous year Q1, and also vis-à-vis the sequential previous quarter.

Speaker #2: But on the EBITDA side, we are all working toward a reduction of the losses on a quarter-on-quarter basis. There is active guidance from the Board as well, in terms of getting it to a path of profitability soon.

Speaker #2: So, a lot of work is happening. I'm not in a position to communicate to you the specific steps, but we continue to stay focused.

Speaker #2: And you can actually see the result of our efforts in terms of the reduction in loss at the EBITDA level, vis-à-vis the previous year's first quarter.

Speaker #2: And also vis-à-vis the sequential previous quarter.

Speaker #4: Understood. And similar comments on network services, because it has been growing quite well. Can we expect a similar kind of growth over the next few quarters in networks as well?

Prateek Singh: Understood. Similar comments on Network Services because it has been growing quite well. Can we expect similar kind of a growth over the next few quarters in networks as well?

Speaker #2: Yeah, network revenue will grow organically, I think. That's a reasonably mature market, so that growth should be reasonably good.

M P Vijay Kumar: Network revenue, it will grow organically. I think that's a reasonably mature market, that growth should be reasonably good.

Speaker #4: Understood, understood. Thanks for your time in answering all my questions, and all the best.

Prateek Singh: Understood. Thanks for your time to answer all my questions, all the best.

Speaker #2: No, no. Thanks, Pratik, for staying engaged.

M P Vijay Kumar: No, thanks, Prateek, for staying engaged.

Speaker #5: As a reminder, if you would like to ask a question, please press star one. We have reached the end of the question-and-answer session.

Operator: As a reminder, if you would like to ask a question, please press star one. We have reached the end of the question and answer session, I will now turn the call over to Raju for closing remarks.

Speaker #5: And I will now turn the call over to Raju for closing remarks.

Speaker #6: Thank you for your time on this call. Have a good day. Thank you very much.

Raju Vegesna: Thank you for your time on this call. Have a good day. Thank you very much.

Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Q1 2027 Sify Technologies Limited Earnings Call

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