Sterlite Technologies Targets 18–20% Ebitda Margin In FY26, Led By Enhanced Capacity Utilisation

Optical fibre and connectivity solutions provider Sterlite Technologies is hopeful of achieving an Ebitda margin of 18% to 20% in FY26, backed by higher capacity utilisation. The company expects an improvement in its cable manufacturing capacity utilisation, according to its Managing Director, Ankit Agarwal.

He expressed confidence in raising the company's factory utilisation from its current 45-50% to over 70% by the third or fourth quarter of the current financial year. 

“If you look at our numbers, from two to three years ago, when we have broadly run our factories at 70% utilisation, we moved towards that 18-20% Ebitda margin from currently around 13-14%,” he said during a conversation with NDTV Profit. 

“We want to take this from about 45-50% utilisation towards 70% plus utilisation. Probably towards quarter three, quarter four this year,” he added. 

Sterlite Technologies is also working towards enhancing its connectivity solutions, aiming to increase its attach rate (the proportion of connectivity products sold alongside cables) from 20-22% to higher levels.

Agarwal identified data centres as a critical growth area, with India’s data centre capacity projected to triple from one gigawatt to three gigawatts by 2030. Sterlite Technologies has launched a dedicated portfolio for this segment and is already in talks with major data centre players in India.

While the United States and Europe remain the primary markets, India holds strategic importance as the company’s home market. Agarwal noted that India accounts for less than 5% of the global optical fibre market but offers growth potential through initiatives like BharatNet Phase 3. 

 “Our focused markets continue to be the US, Europe and India. In India, we do expect some growth on the back of BharatNet Phase 3. Important to appreciate that India is less than 5% of the world's optical market. Major impact on our bottom line comes from Europe and the US markets,” he added.

On the financial front, Sterlite Technologies is focused on reducing its debt, having completed most of its capital expenditure in recent years. Agarwal reiterated the company’s target to bring its net debt-to-EBITDA ratio down to two times by the end of the year. It will strengthen the company’s balance sheet while supporting sustainable growth.

When asked about potential partnerships with Starlink, Agarwal opened up about the possible areas of collaboration. 

“If there is an option to partner with them on some of the connectivity requirements from the satellite, from the link at the home into the house, I think those are areas we could look to partner with them,” the MD said.

Shares of Sterlite Technologies were trading 0.84% higher at Rs 127.95 apiece on the NSE at 2:28 p.m., while the benchmark Nifty50 stood at 24,810.3, up 0.52%.