The Sterlite margin target for FY2029 rose to approximately 30% from 27%, while the optical connectivity company retained its INR20,000 crore revenue goal. In its October 23, 2026 earnings discussion, Sterlite Technologies management attributed the higher EBITDA margin ambition to a growing data center business, stronger accessories sales and a record order book.
Key Takeaways
- Management raised its FY2029 EBITDA margin target by about three percentage points without changing the revenue goal.
- Q2 FY2027 operational EBITDA margin reached 27.1%; reported EBITDA also included a one-time tariff refund gain.
- The INR35,274 crore order book supports expansion plans, but deliveries remain dependent on capacity and customer project execution.
Table of Contents
- Sterlite margin target reflects a changing sales mix
- Operating gains and a tariff refund lift quarterly earnings
- Order growth brings capacity and delivery requirements
- New fiber products remain a longer-term opportunity
- Conclusion
Sterlite margin target reflects a changing sales mix
Managing Director Ankit Agarwal said the higher FY2029 margin target reflected a shift toward the more profitable data center portfolio and an improved attach rate, the company's measure relating to its accessories business.
Data centers contributed 33% of revenue in the first half of FY2027. Management is targeting approximately 50% for the full fiscal year, making the planned mix shift an important part of its profitability ambitions rather than an already achieved result.
The attach rate reached 24% in the first half, compared with 20% a year earlier, against a full-year target above 25%. Agarwal said the company would continue assessing its order book, execution and capacity buildout before any future update to the revenue target.
| Item | Details |
|---|---|
| H1 FY2027 revenue | INR4,439 crore, up 116% year over year |
| H1 FY2027 operational EBITDA | INR1,082 crore, at a 24.4% margin |
| H1 geographic revenue mix | North America 61%; Europe 21%; rest of world 18% |
| Net cash | INR703 crore, versus INR483 crore in the preceding quarter |
Operating gains and a tariff refund lift quarterly earnings
Q2 FY2027 revenue reached a record INR2,529 crore, up 145% year over year and 32% from the preceding quarter. Operational EBITDA—earnings before interest, taxes, depreciation and amortization—was INR685 crore, with its margin expanding 624 basis points sequentially to 27.1%.
Reported EBITDA was higher at INR846 crore because it included a one-time net gain of INR161 crore from a US tariff refund. The distinction matters when comparing the quarter's underlying operating profitability with the longer-term margin target.
Quarterly profit after tax reached a record INR517 crore. The company also recorded an INR49 crore impairment and INR22 crore of additional depreciation related to subsidiary Speedon Networks. Chief Financial Officer Ajay Jhanjhari said loan-prepayment penalties pushed finance costs higher despite debt reduction, and he expects net finance costs to decline.
Order growth brings capacity and delivery requirements
The open order book reached INR35,274 crore, approximately 4.6 times its INR7,687 crore level at the start of the fiscal year. First-half order intake totaled INR32,000 crore, roughly four times the orders secured during all of FY2026.
A five-year, $1.2 billion agreement with a global hyperscaler followed a previously announced $1.11 billion award. Management also described continuing contracts with telecom operators and neutral fiber providers, rather than a pipeline consisting solely of data center customers.
Sterlite has committed approximately INR1,000 crore of annual capital expenditure through FY2029 for a 50% expansion in preform, fiber and cable capacity and a new greenfield pre-terminated solutions facility. About INR3,021 crore of the order book is scheduled for execution in Q3 FY2027.
Agarwal acknowledged customer project challenges involving land, power and water availability, while saying customer conversations remained unchanged. Orders therefore provide a delivery pipeline, not revenue already recognized.
New fiber products remain a longer-term opportunity
Management expects hollow-core and multi-core fiber technologies to scale over the next one and a half to two years, with installation and maintenance challenges still requiring work alongside customers and installers.
STL's multi-core fiber design places several optical cores within a single strand, allowing parallel transmission of light signals. The company's product documentation describes up to four times the bandwidth in the same physical footprint; this explains the technology's capacity proposition, not the latest earnings or its commercialization timetable.
Conclusion
The next scheduled milestone is execution of approximately INR3,021 crore of orders in Q3 FY2027. Progress on those deliveries, the data center revenue mix and capacity additions will help show how operating performance is tracking toward the higher FY2029 margin target.
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