BSE:532374

Stock Analysis Report

Sterlite Technologies

Executive Summary

Sterlite Technologies Limited manufactures and sells telecom products and solutions in India and internationally.

Rewards

Trading at 36.2% below its fair value

Earnings are forecast to grow 9.8% per year

Earnings grew by 34.1% over the past year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Highly volatile share price over past 3 months



Snowflake Analysis

Undervalued established dividend payer.


Similar Companies

China Mobile

SEHK:941

Share Price & News

How has Sterlite Technologies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 532374's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.2%

532374

2.1%

IN Communications

0.2%

IN Market


1 Year Return

-58.1%

532374

-36.8%

IN Communications

3.1%

IN Market

Return vs Industry: 532374 underperformed the Indian Communications industry which returned -36.8% over the past year.

Return vs Market: 532374 underperformed the Indian Market which returned 3.1% over the past year.


Shareholder returns

532374IndustryMarket
7 Day-1.2%2.1%0.2%
30 Day-2.3%1.5%0.1%
90 Day-15.1%-0.6%6.5%
1 Year-57.2%-58.1%-36.1%-36.8%5.1%3.1%
3 Year30.7%26.5%50.5%47.7%33.6%26.5%
5 Year96.6%86.0%117.1%109.7%41.1%28.3%

Price Volatility Vs. Market

How volatile is Sterlite Technologies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sterlite Technologies undervalued compared to its fair value and its price relative to the market?

36.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 532374 (₹121.15) is trading below our estimate of fair value (₹189.9)

Significantly Below Fair Value: 532374 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 532374 is good value based on its PE Ratio (7.9x) compared to the Communications industry average (12.7x).

PE vs Market: 532374 is good value based on its PE Ratio (7.9x) compared to the Indian market (12.8x).


Price to Earnings Growth Ratio

PEG Ratio: 532374 is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: 532374 is overvalued based on its PB Ratio (2.7x) compared to the IN Communications industry average (1x).


Next Steps

Future Growth

How is Sterlite Technologies forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

9.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 532374's forecast earnings growth (9.8% per year) is above the savings rate (6.5%).

Earnings vs Market: 532374's earnings (9.8% per year) are forecast to grow slower than the Indian market (19.6% per year).

High Growth Earnings: 532374's earnings are forecast to grow, but not significantly.

Revenue vs Market: 532374's revenue (9.5% per year) is forecast to grow slower than the Indian market (11.6% per year).

High Growth Revenue: 532374's revenue (9.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 532374's Return on Equity is forecast to be high in 3 years time (25.2%)


Next Steps

Past Performance

How has Sterlite Technologies performed over the past 5 years?

53.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 532374 has high quality earnings.

Growing Profit Margin: 532374's current net profit margins (10.4%) are lower than last year (12.6%).


Past Earnings Growth Analysis

Earnings Trend: 532374 has become profitable over the past 5 years, growing earnings by 53.9% per year.

Accelerating Growth: 532374's earnings growth over the past year (34.1%) is below its 5-year average (53.9% per year).

Earnings vs Industry: 532374 earnings growth over the past year (34.1%) exceeded the Communications industry -39.4%.


Return on Equity

High ROE: 532374's Return on Equity (32.7%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Sterlite Technologies's financial position?


Financial Position Analysis

Short Term Liabilities: 532374's short term assets (₹38.9B) do not cover its short term liabilities (₹42.3B).

Long Term Liabilities: 532374's short term assets (₹38.9B) exceed its long term liabilities (₹10.3B).


Debt to Equity History and Analysis

Debt Level: 532374's debt to equity ratio (84.3%) is considered high.

Reducing Debt: 532374's debt to equity ratio has reduced from 364.2% to 84.3% over the past 5 years.

Debt Coverage: 532374's debt is well covered by operating cash flow (56.4%).

Interest Coverage: 532374's interest payments on its debt are well covered by EBIT (7.5x coverage).


Balance Sheet

Inventory Level: 532374 has a high level of physical assets or inventory.

Debt Coverage by Assets: 532374's debt is covered by short term assets (assets are 2.4x debt).


Next Steps

Dividend

What is Sterlite Technologies's current dividend yield, its reliability and sustainability?

2.89%

Current Dividend Yield


Dividend Yield vs Market

company2.9%marketbottom25%0.6%markettop25%2.5%industryaverage2.2%forecastin3Years3.6%

Current dividend yield vs market & industry

Notable Dividend: 532374's dividend (2.89%) is higher than the bottom 25% of dividend payers in the Indian market (0.59%).

High Dividend: 532374's dividend (2.89%) is in the top 25% of dividend payers in the Indian market (2.54%)


Stability and Growth of Payments

Stable Dividend: 532374's dividend payments have been volatile in the past 10 years.

Growing Dividend: 532374's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (22.8%), 532374's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 532374's dividends in 3 years are forecast to be well covered by earnings (28.6% payout ratio).


Next Steps

Management

What is the CEO of Sterlite Technologies's salary, the management and board of directors tenure and is there insider trading?

8.4yrs

Average management tenure


CEO

Anand Agarwal (52yo)

16.9yrs

Tenure

₹123,953,000

Compensation

Dr. Anand Gopaldas Agarwal serves as Group Chief Executive Officer of Sterlite Technologies Limited. Dr. Agarwal served as the Chief Operating Officer of Sterlite Technologies Limited was responsible for O ...


CEO Compensation Analysis

Compensation vs Market: Anand's total compensation ($USD1.75M) is above average for companies of similar size in the Indian market ($USD424.69K).

Compensation vs Earnings: Anand's compensation has increased by more than 20% in the past year.


Management Age and Tenure

8.4yrs

Average Tenure

50yo

Average Age

Experienced Management: 532374's management team is seasoned and experienced (8.4 years average tenure).


Board Age and Tenure

8.5yrs

Average Tenure

61.5yo

Average Age

Experienced Board: 532374's board of directors are considered experienced (8.5 years average tenure).


Insider Trading

Insider Buying: 532374 insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Sell₹2,349,83404 Oct 19
Ajay Razdan
EntityIndividual
Shares15,000
Max Price₹157.24
Sell₹1,597,99604 Oct 19
Ajay Razdan
EntityIndividual
Shares10,000
Max Price₹159.80
Sell₹4,885,36727 Sep 19
K. Rao
EntityIndividual
Role
Senior Key Executive
Chief Executive Officer of Network Services Business
Shares35,000
Max Price₹139.58
Sell₹887,73427 Sep 19
Pankaj Aggarwal
EntityIndividual
Shares6,000
Max Price₹147.96
Sell₹150,00027 Sep 19
Vimal Malhotra
EntityIndividual
Shares1,000
Max Price₹150.00
Sell₹1,750,00002 Jul 19
Saurabh Kumar
EntityIndividual
Shares10,000
Max Price₹175.00
Sell₹637,08102 Jul 19
Pramod Srivastava
EntityIndividual
Shares3,539
Max Price₹182.73
Buy₹9,896,62428 May 19
Pravin Agarwal
EntityIndividual
Role
Vice Chairman
Vice Chairman & Whole-time Director
Shares57,000
Max Price₹173.62
Sell₹185,35014 May 19
Pramod Srivastava
EntityIndividual
Shares1,000
Max Price₹185.35
Sell₹645,93310 May 19
Pramod Srivastava
EntityIndividual
Shares3,500
Max Price₹184.68
Sell₹1,013,38313 Mar 19
Kanchan Ghatak
EntityIndividual
Shares4,000
Max Price₹265.00
Sell₹1,093,45612 Mar 19
Puneet Garg
EntityIndividual
Shares4,000
Max Price₹273.36
Sell₹800,81212 Mar 19
Pramod Srivastava
EntityIndividual
Shares3,000
Max Price₹270.00
Buy₹29,30206 Mar 19
Vikrant Lele
EntityIndividual
Shares130
Max Price₹225.40
Sell₹31,20006 Mar 19
Vikrant Lele
EntityIndividual
Shares130
Max Price₹240.00
Sell₹3,777,48531 Jan 19
Pramod Watekar
EntityIndividual
Shares14,420
Max Price₹261.96
Buy₹2,961,90731 Jan 19
Ankit Agarwal
EntityIndividual
Role
Senior Key Executive
Chief Executive Officer of Connectivity Solutions Business
Shares11,620
Max Price₹254.90
Sell₹583,46625 Dec 18
Pramod Srivastava
EntityIndividual
Shares2,000
Max Price₹298.93
Buy₹3,45524 Dec 18
Nikhil Puri
EntityIndividual
Shares11
Max Price₹337.88
Sell₹1,466,73220 Dec 18
Pramod Srivastava
EntityIndividual
Shares4,628
Max Price₹362.32

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Pravin Agarwal (65yo)

    Vice Chairman & Whole-time Director

    • Tenure: 0yrs
    • Compensation: ₹143.44m
  • Anand Agarwal (52yo)

    Group CEO & Whole-time Director

    • Tenure: 16.9yrs
    • Compensation: ₹123.95m
  • K. Rao (48yo)

    Chief Executive Officer of Network Services Business

    • Tenure: 2.9yrs
    • Compensation: ₹14.42m
  • Anupam Jindal (43yo)

    Group Chief Financial Officer

    • Tenure: 13.9yrs
  • Ankit Agarwal

    Chief Executive Officer of Connectivity Solutions Business

    • Tenure: 0yrs
  • Badri Gomatam (54yo)

    Group Chief Technology Officer

    • Tenure: 0yrs
    • Compensation: ₹14.35m
  • Amit Deshpande

    Corporate General Counsel

    • Tenure: 0yrs
  • Manish Sinha (43yo)

    Chief Marketing Officer

    • Tenure: 2.3yrs
  • Vishal Aggarwal

    Head of Investor Relations

    • Tenure: 0yrs
  • Anjali Byce

    Chief Human Resources Officer

    • Tenure: 0yrs

Board Members

  • Anil Agarwal (67yo)

    Non-Executive Chairman

    • Tenure: 13.2yrs
  • Sandip Das (61yo)

    Member of Advisory Board & Non-Executive Independent Director

    • Tenure: 2.2yrs
    • Compensation: ₹1.48m
  • B. Shantharaju

    Member of Advisory Board

    • Tenure: 3.2yrs
  • Arun Todarwal (62yo)

    Non-Executive & Independent Director

    • Tenure: 16.9yrs
    • Compensation: ₹2.40m
  • Pravin Agarwal (65yo)

    Vice Chairman & Whole-time Director

    • Tenure: 0yrs
    • Compensation: ₹143.44m
  • Anand Agarwal (52yo)

    Group CEO & Whole-time Director

    • Tenure: 16.9yrs
    • Compensation: ₹123.95m
  • Alampallam Narayanaswamy (68yo)

    Non-Executive & Independent Director

    • Tenure: 12.7yrs
    • Compensation: ₹2.15m
  • Pratik Agarwal (36yo)

    Non-Executive Director

    • Tenure: 6.7yrs
    • Compensation: ₹1.70m
  • Kumud Srinivasan (59yo)

    Non-Executive & Independent Director

    • Tenure: 1.6yrs
    • Compensation: ₹325.00k

Company Information

Sterlite Technologies Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sterlite Technologies Limited
  • Ticker: 532374
  • Exchange: BSE
  • Founded: 1988
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: ₹48.930b
  • Shares outstanding: 403.88m
  • Website: https://www.sterlitetech.com

Number of Employees


Location

  • Sterlite Technologies Limited
  • Godrej Millennium
  • Ground Floor
  • Pune
  • Maharashtra
  • 411001
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
532374BSE (Mumbai Stock Exchange)YesEquity SharesININRNov 2000
STRTECHNSEI (National Stock Exchange of India)YesEquity SharesININRNov 2000

Biography

Sterlite Technologies Limited manufactures and sells telecom products and solutions in India and internationally. It offers fiber optical cables, optical fibers, and copper telecom cables; and fibre optica ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/14 12:36
End of Day Share Price2019/12/13 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.