In the first quarter of the fiscal year 2024-25, Sify Technologies Limited reported a revenue increase to Rs. 9,421 million, marking a 10% growth compared to the same period last year. Despite this growth, the company registered a loss before tax of Rs. 46 million and a loss after tax of Rs. 105 million. EBITDA for the quarter was Rs. 1,784 million, showing a 3% increase over the previous year.
The primary factor behind the loss is attributed to significant capital expenditures and rising operational costs. The firm’s capital expenditure (CAPEX) for the quarter was Rs. 2,656 million, reflecting its focus on expanding infrastructure to support digital transformation initiatives across India. The company’s aggressive investment strategy aligns with its goal of strengthening its data centre and network services capabilities, which face intense competition from new players.
“India is currently in a remarkable phase of growth. The combination of pro-industry regulations, a supportive investment environment, and a wealth of skilled talent positions our nation as a key destination for international businesses. This confidence is driving investments and building partnerships that benefit both enterprises and the broader economy,” said Sify Chairman Raju Vegesna.
The Chennai-headquartered firm’s strategic emphasis on infrastructure expansion is evident in its recent commissioning of 6.5 MW of data centre capacity in Mumbai. Additionally, the company has increased its network connectivity services, deploying 9,415 SD-WAN service points across the country, which underscores the rising demand for secure and reliable network solutions, said the company.
The IT major’s revenue streams are diversified, with data centre colocation services contributing 36%, digital services 23%, and network services 41% of the total revenue for the quarter. The firm caters to a wide range of market segments, from cloud solutions and managed services to network infrastructures.
“Our significant capital allocations and extensive range of offerings are designed to effectively meet these ambitions. Our capability to provide innovative outcomes through our triad of infrastructure and managed services uniquely positions us to support them throughout their digital transformation,” said Sify CEO Kamal Nath.
The data centre major said that customer engagement remains strong, with notable contracts secured across various service segments. In network services, the company secured deals with a global IT major for interconnect services, the largest stock exchange for an MPLS network build, and a leading private bank for managed and secure SD-WAN services. Data centre services also saw significant traction, with a global OTT player and the country’s largest bank signing multi-year capacity deals.
The company said it was contracted by the highest judicial body in the country for a multi-year data centre infrastructure build and related managed services.
Financially, the firm’s equity as of 30 June 2024, stood at Rs. 17,369 million, an increase from Rs. 15,210 million from the previous year. Long-term borrowings were Rs. 16,717 million, indicating the company’s strategic use of debt to fund its expansion initiatives. Short-term borrowings also saw an increase, amounting to Rs. 7,218 million compared to Rs. 6,581 million a year ago.
“The new structure for the profit and loss statement requires the classification of income and expenses into three new categories – operating, investing, and financing. Although the IASB set an effective date as January 1, 2027, the Company will begin adhering to IFRS 18 beginning with its unaudited consolidated financial statements for the quarter ended June 30, 2024,” said M P Vijay Kumar, ED & Group CFO, Sify.
The company said it continues to prioritise investment in network and data centre expansion, alongside enhancing its digital services team. The firm’s cash balance at the end of the quarter was Rs. 6,471 million.
“We will continue to invest in expanding our network, both fibre in the metros and terrestrial long distance, data centre capacity and also strengthen our digital services team by adding people with the right skill sets and investing more in our learning and development initiatives,” Kumar added.
