WELCOME

SIFY

INVESTOR

DAY

Lotte Palace

New York

SIFY TECHNOLOGIES

INDIA: DIGITAL DISRUPTION

May’18

David Nishball

2

3

CONNECTED WORLD E-COMMERCE SMART CITIES E - LEARNINGDIGITAL BUSINESS

By 2020, smart phone

users are expected to

reach 2.87 Bn

60% of global FMCG

sales are driven by online channels

Global online spend is

expected to reach

$4.48 Tn by 2020

Global smart city spend

is expected to reach

$34.35 Bn by 2020

Global online

education to reach

$275 Bn by 2021

THE GLOBAL “DIGITAL WAVE”

A global digital wave is creating massive new growth opportunities

The India digital economy is expected to reach $1 Trillion by 2025 4

THE INDIA “DIGITAL TSUNAMI”

CONNECTED WORLD E-COMMERCE SMART CITIES E - LEARNINGDIGITAL BUSINESS

By 2020, smart phone

users are expected to

reach 2.87 Bn

60% of global FMCG

sales are driven by online channels

Global online spend is

expected to reach

$4.48 Tn by 2020

Global smart city spend

is expected to reach

$34.35 Bn by 2020

Global online

education to reach

$275 Bn by 2021

IN INDIA:

330 Mn connected

smart phone users in

2017, 500 Mn by 2020

IN INDIA:

10-15% of FMCG sales

are online in 2016,

40% of sales by 2020

IN INDIA:

Online spend to grow

2.5X to $100 Bn by 2020

IN INDIA:

$1482 Mn has been

allocated for the smart

city project

IN INDIA:

Online education will

grow by 8X to $2 Bn by 2021

The alignment of forces is creating a Perfect Storm of new opportunities 5

DIGITAL INDIA – A PERFECT STORM

CONNECT INDIA

10 Gbps to all villages

100 Mbps to all schools

Broadband to 50% of households

10 M public Wi-Fi hotspots

SECURE INDIA

Comprehensive data protection regime

Net neutrality principles

Security testing and standards

Encryption and security clearances

NATIONAL DIGITAL COMMUNICATIONS POLICY

(2020 GOALS)

PROPEL INDIA

Investments of USD 100 Billion

Creation of innovation led start-ups

Train/ re-skill 1 Million

Expand IoT ecosystem to 5 Billion

The alignment of forces is creating a Perfect Storm of new opportunities 6

$5 billioncommitted to invest in India

130,000employees in India –

more than any other country

$1.6 billionfor 77% of Flipkart

1,150MNCs in India with

Global In-House Centres

$23.1 billionGIC revenue in 2016

FOREIGN DIRECT DIGITAL INVESTMENT

$1.7 billionInvested in Indian

startups

DIGITAL INDIA – A PERFECT STORM

The alignment of forces is creating a Perfect Storm of new opportunities 7

CONSUMER RESPONSE

30.4 MnTwitter users

as of Feb 18

200 MnWhatsapp users

as of Feb 18

241 MnFacebook Users

vs 240 Mn in US

730+ MnMobile phones

1 TrillionMobile wallet

Transactions by 2018

1 TrillionMobile wallet

Transactions by 2018

1+ Mn 15 MnSmart meters installed by

installed 2020

India becomes

world’s fastest

growing market for apps

DIGITAL INDIA – A PERFECT STORM

SIFY’S JOURNEY SO FAR…

Sify has surfed the wave of technology disruption from its inception

1995

1998

1999

2000

2001

2004

2008

2012

2013

2016

2017

Established HQ

in Chennai

Launch of RIM

services, NOC,

SOC services

Launch of MPLS

service in India

First Tier3

Datacenter in

India

Listed on

NASDAQ

First private

ISP in India

Launch of

Cloudinfinit

services

Exit Consumer

Broadband/Cyber

Café

Launch of hybrid

cloud and CI

containers

Launch of SAP

Private Cloud

practice

Launch of

business outcome

based models

8

A balanced portfolio to help clients navigate digital transformation 9

• India Data Business

• Global Data Business

• Cloud Connect &

Managed DWDM

• Enterprise VoIP

• Managed Network

Services

TELECOM SERVICES

• Colocation/White labelling

• Data center Transformation

• Public Cloud (LaaS/PaaS)

• Enterprise private and hybrid cloud

• Cloud based DR

• DC Managed Services

• Managed Security Services

DC, CLOUD & MANAGED SERVICES

• Data Center IT

• Network Integration

• Information Security Services

• Collaboration Services

• End User Computing Services

TECHNOLOGY INTEGRATION SERVICES

APPLICATIONS SERVICES

• iTest – Online Testing Platform

• eLearning

• Forum – Distribution Management

System

• Portal Solutions

PLATFORM SERVICES

• SAP / S4 Hana, Success Factors and hosted cloud infrastructure

• Microsoft – Azure, Office & Productivity, Dynamics CRM

• Oracle – SaaS, PaaS (HR, Database, Middleware, Cloud Machine)

SIFY TODAY

SIFY’S KEY ASSETS

• 6 Pan-India DCs with 47MW capacity (utility)

• 5 more DCs in progress, >2X capacity

Relevance to Digital India

• Hosting for hyperscale operators

• Centerpiece of the hybrid cloud

Sify’s assets are ideally matched to the Digital India opportunity set

• IT-enablement for distributed businesses

• Supports digital transformation initiatives

• Global and domestic IT outsourcing

• Supports outcome-based services model

• Internet growth from non-metros

• Platform to move content to “edge”

• Cost-effective terabit network scale

• Interconnect public and private clouds

• Largest MPLS network (by connections)

• Spans 1400 cities and towns

• “Cloud Connect” data superhighway

• 43 on-net data centers

• Remote Operations Centers

• NOC, SOC, managed services

• Applications and solutions

• Cloudinfinite, I-Test, Forum, SAP/Oracle

Sify Assets

10

Sify excels in areas at the cornerstone of Digital India transformation

HYPER-REACHSify can uniquely serve

large multi-location IT

projects

HYPER-SCALESify enables public cloud

and scalable

interconnection

BUSINESS MODEL

Sify is fully aligned to

the service provider model

PARTNERSHIPSSify collaborates with

the next-gen

operators

ADVANTAGE SIFY

11

TELECOM SERVICES : IT SERVICES WALLET SHARE

SIFY’S EVOLUTION

2013-14 2014-15 2015-16 2016-17 2017-18

REVENUE & GROWTH

USD

Million

Cloud Transformation

PartnerConverged ICT Services

Provider

PROFIT AFTER TAX (PAT)

Network/DCService

Provider

Managed Services Provider

161198

231

283318

0

50

100

150

200

250

300

350

2013-14 2014-15 2015-16 2016-17 2017-18

4.95.8

6.7

9.9

14.2

0

2

4

6

8

10

12

14

16

2013-14 2014-15 2015-16 2016-17 2017-18U

SD

Million

RESULTS TO DATE

12By embracing Digital India, Sify has delivered consistent above-market growth

In %

34.3 34.3 36.5 44.9 51.8

65.7 65.7 63.5 55.1 48.2

0

20

40

60

80

100

2013-14 2014-15 2015-16 2016-17 2017-18

DC Centric IT Services Telecom Centric Services

Increased consumption ofCLOUD BASED

services

Ubiquitous data connectivity and

HIGHSPEED ENTERPRISE NETWORKS

Opportunity to HOST DATA

under outsourced model in a data center

Demand for MANAGED SERVICES

to host and manage application and

platforms

Extensive need for SECURITY SERVICESto prevent threat and

theft

WHAT IT MEANS FOR SIFY?

13The digital India phenomenon will lead to many more growth opportunities for Sify

14

SIFY TECHNOLOGIES

SIFY: LEADING THE DISRUPTION

May’18

Kamal Nath

15

GOVERNMENT PROGRAMS COMPLEMENT PRIVATE SECTOR INITIATIVES

TRENDS CHANGING THE PROVIDER MARKETPLACE

Customers DC mobbing from on-

premise to hosted DC & Cloud

Trends

16

Advantage

Build IT to Consumed IT Model

Outcome-Based Engagement

Models

DC and Cloud SP with Managed

Services and Integration Capabilities

Cloud Services Provider with

Integrated ICT Offerings

Integrated ICT Players with Cloud

Offerings & Vertical Expertise

SIFY TODAY: FROM A CUSTOMER PERSPECTIVE

Service provider with

expertise in

SYSTEM INTEGRATION

AND APPLICATION

domain

Only ICT service provider

to offer

“CONSUMPTION”

as well as “BUILD”

models to clients

Multiple commercial models

COMPONENT ALIGNED,

USAGE ALIGNED and

BUSINESS OUTCOME

ALIGNED

Ability to compete and replace

traditional

TELCO & IT SERVICES providers,

new-age DC & CLOUD providers

and

pure play MANAGED SERVICES

provider

17

ENGAGEMENT MODELS

Systems are owned by

the client and annuity

based payout for

services

No upfront

investment by

client and

payout is based

on consumption

Reduced upfront investment

as client subscribes to

infrastructure owned by

Sify as a part of their

overall infrastructure

requirement

Client

engagement is

based on defined

business outcome

generated by IT

solutions and

services

Less Hardware

PeopleLicenses

18

OUR SERVICES MODEL ALIGNED TO CUSTOMERS’ DIGITAL JOURNEY

UTILITIES

Pay per bill

EDUCATIONPay per student

HEALTHCARE

Pay per patientINSURANCE

Pay per policy Pay per trip

RETAILPay per item

STOCKSPay per

transaction

Pay per tonne

SifyTransformation

Model

ServiceConsumption

Unit

MANUFACTURING

TRAVEL

19

EXECUTION CAPABILITIES

20

CLOUD@CORE: OUR NEXT ENGINE FOR GROWTH

█ Managed wireless platform

█ Private cloud for SAP/S4HANA

█ Oracle cloud serviceExadata-as-service

█ Cloud data centers

█ Software Defined Network services

█ Cloud buildPrivate | Hyperconverged | Enterprise

█ Security services for cloud

█ Hyper reach / hyper scale transport AWS DirectConnect | XpressRoute

█ Sify Applications on Cloud█ Forum NXT

█ iTest

█ e-Learning

█ Internet of Things (IoT) solutions

█ Industry solution-as-a-service (business outcome based)

pay per bill |pay per patient |pay per student |

pay per transaction

█ Hyperscale cloud servicesAWS | Azure

█ Hybrid cloud managed service

cloud@

core

█ Sify cloudinfinitGoInfinit Private | GoInfinit Backup |

GoInfinit Accelerate | GoInfinit VPE

█ Unified Communications on Cloud

23

CLOUD@CORE: AGILITY, FLEXIBILITY & CHOICES

Investment and IP

Commitments

Commitment of

providing choices

Commitment beyond

Infra: Platform & SaaS

Commitment beyond

Cloud: Network for

Cloud

Commitment to

make Cloud

secure

Capability and Commitment to

build Cloud

CLOUD@CORE

22

CLOUD@CORE: ALIGNING TO OUR VERTICAL STRATEGY

23

STRATEGIC PARTNERSHIPS

TechnologyPartners

Cloud and Acceleration

Partners

ApplicationPartners

Security Partners

24

RECOGNITION

Data Center

Transformation

Services

2018

Sify moves up to the challenger position in the

Gartner MQ for Managed Hybrid Cloud Hosting – Asia

Pacific (2017)

Network

Transformation

Services

201825

cloud@core digital@core

OUR NEXT TRANSFORMATION

26

SIFY TECHNOLOGIES

27

PROFITING FROM DISRUPTION

May’18

M P Vijay Kumar

• Revenue crosses US$ 300 Mn+ (INR 2000 + Cr) in FY 2017 - 18

• DC centric IT Services now contributes more than 50% of the overall revenue

(CAGR of 31% over last 5 years)

• Revenue Growth : CAGR 19% in last 5 years

• EBITDA Growth : CAGR 16% in last 5 years

• PAT : CAGR 30% in last 5 years

• Cash balance at the end of the year US $ 35 Mn (INR 227+ Cr)

• Consistently generating Profit for 20 quarters

• Board has recommended Dividend distribution to shareholders for fifth consecutive year for FY 17 - 18

• Continued investment to support growth in

• Infrastructure and tools (Capital expenditure) and

• Skill development of associates (Revenue expenditure).

• Credit Rating : Long term A+, Short term A1+

• 2012 to 2018 : BBB- to A+ ( 5 levels improvement in 6 years)

• Completed 18 continuous years of listing on the NASDAQ stock market

HIGHLIGHTS

Note: FY 17 – 18 numbers are Unaudited 28

Revenue

0

100

200

300

400

Yr 13-14 Yr 14-15 Yr 15-16 Yr 16-17 Yr 17-18*

161198

231

284318

(in USD Mn)

EBITDA

PAT Capital Expenditure #

0

10

20

30

40

50

Yr 13-14 Yr 14-15 Yr 15-16 Yr 16-17 Yr 17-18*

24

31

38 4044

0

5

10

15

Yr 13-14 Yr 14-15 Yr 15-16 Yr 16-17 Yr 17-18*

4.95.8

6.7

9.9

14.2

FINANCIAL METRICS – IN $ MN in constant currency 1 USD @ INR 65

*Unaudited

*

-

10

20

30

40

13-14 14-15 15-16 16-17 17-18

18 17 14 14 16

14 11 16 17

22

Telecom Non Telecom

3228 30 31

38

# Capital Expenditure includes Capital WIP29

Revenue from IT Services has grown over the past 5

years at a CAGR of 31%

IT Services revenue accounts for 52% of the revenue

of the company

SEGMENT-WISE PERFORMANCE in constant currency 1 USD @ INR 65

*Unaudited

55% 45%

52%48%

Telecom centric services

Data Center centric IT

Services

30

106

55

130

68

147

84

157

127

154 164

-

20

40

60

80

100

120

140

160

180

Telecom centric DC centric

Revenue $Mn

13-14 14-15 15-16 16-17 17-18*

FY2016-17

FY 2017-18

Revenue EBITDA & Net Profit

Cash flows Capital Expenditure

2017 – 18 numbers are Unaudited # Capital Expenditure includes Capital WIP

9.6 9.8 10.8

9.4 10.8 11.0 10.8 11.4

1.9 2.4 2.7 2.8 2.7 3.1 4.4 4.0

-

2.0

4.0

6.0

8.0

10.0

12.0

Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18

EBITDA Net Profit

11.7

2.2 5.5

7.4 8.8 6.6

3.5

14.6

-1.4

-6.9 -7.4 -9.0 -8.9 -6.3 -5.4

-7.9

-1.0 -2.6 1.4 -1.9 -4.4 -4.6

-1.7

-5.4

-15.0

-10.0

-5.0

-

5.0

10.0

15.0

20.0

Operating activities Investing activities Financing activities

5

7 8

11

8 6 7

17

-

2

4

6

8

10

12

14

16

18

Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18

39

25

40

28

38 33

40 41 37

33 40

35 39 41

38

56

-

10

20

30

40

50

60

Telecom Centric Services DC Centric IT Services

Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18

FINANCIAL METRICS – IN $ MN in constant currency 1 USD @ INR 65

NON - FINANCIAL METRICS

Telecom Data Centre

Cloud and Managed services

378436

629

300

400

500

600

700

Mar 16 Mar 17 Mar 18

Port capacity sold in GBPS

2000

2400

3100

1500

2000

2500

3000

3500

Mar 16 Mar 17 Mar 18

Customer workloads managed

750

900

1200

500

700

900

1100

1300

Mar 16 Mar 17 Mar 18

Storage managed in TB

11

16

19

5

10

15

20

Mar 16 Mar 17 Mar 18

Sold capacity in MW

++

+

++

+

Manpower (Head count)

2175

2318

2608

1750

2000

2250

2500

2750

Mar 16 Mar 17 Mar 18

Return on Equity EPS (in INR)

Fixed Assets turnover Long Term Debt Equity Ratio

KEY RATIOS

4.8% 5.3%6.0%

8.2%

10.7%

1.0%

3.0%

5.0%

7.0%

9.0%

11.0%

13.0%

2013-14 2014-15 2015-16 2016-17 2017-18

1.8

2.0

2.2

2.6 2.8

1.5

1.8

2.1

2.4

2.7

3.0

2013-14 2014-15 2015-16 2016-17 2017-18

0.29

0.36 0.35

0.28

0.35

0.20

0.30

0.40

2013-14 2014-15 2015-16 2016-17 2017-18

**

**

*Unaudited

2.653.11

4.45

6.14

0

1

2

3

4

5

6

7

2014-15 2015-16 2016-17 2017-18*

33

SNAPSHOT

Details 2013-14 2014-15 2015-16 2016-17 2017-18 * Remarks

Revenue 161 198 231 284 318 Steady growth - CAGR 19%

EBITDA 24 31 38 40 44 Consistent performance - CAGR 16%

PAT 5 6 7 10 14

Stable track record - CAGR 30%

Consistent for 20 quarters

Equity 107 110 115 127 139

Borrowing (Long term) 31 40 41 35 49

Fixed Assets (incl WIP) 95 101 107 110 120 Continued investment in assets

Cash 20 23 27 29 35

Increase in the liquidity of the company over the

period.

Dividend paid 10% 10% 10% 12%

Board has recommended Dividend distribution to

shareholders for fifth consecutive year

Credit Rating BBB A- A A+ A+ Steady rise in credit rating over the years

Amount in $ Mn in constant currency 1 USD @ INR 65

$ Mn

*Unaudited 34

PROFIT AND LOSS BALANCE SHEET

Details 13-14 14-15 15-16 16-17 17-18*

Equity 107 110 115 127 139

Borrowing (LT) 31 40 41 35 49

Borrowing (ST) 17 23 29 41 40

Other Liabilities 62 77 101 128 148

Total Liabilities 217 250 286 331 376

Fixed Assets 95 101 107 110 120

Lease hold

Prepayment 13 13 14 16 21

Inventories 3 4 11 18 10

Receivables 75 94 113 135 165

Cash 20 23 27 29 35

Other Assets 12 16 14 23 25

Total Assets 217 250 286 331 376

$ Mn $ Mn

*Unaudited

Amount in $ Mn in constant currency 1 USD @ INR 65

Details 13-14 14-15 15-16 16-17 17-18 *

Revenue 161 198 231 284 318

COGS 94 119 140 183 207

SG&A 42 48 54 61 68

EBITDA 24 31 38 40 44

Depreciation 17 20 25 27 27

Net Finance expense 4 7 8 5 6

Other Income 1 1 2 2 3

PROFIT AFTER TAX

(PAT) 5 6 7 10 14

Cash flows

Operating activities 15 24 38 27 33

Investing activities (12) (13) (24) (25) (28)

Financing activities 2 (9) (9) (4) (16)

Cash and

cash equivalents 20 23 27 29 35

35

FUTURE FOCUS

• Increase in Asset turnover

• Higher realisation by increasing usage of applications and tools

• Focussed monetization of investments in both Assets and People

• Synergy across the ecosystem translating into better offtake of

services

• Consistent improvement in credit rating

• Examining alternate sources of low cost debt

• Internal accruals

• Leveraging debt

• Equity commitment available from partly

paid shares

AREAS TO

IMPROVE

FINANCIAL

PERFORMANCE

FINANCING

OUR PLANNED

INVESTMENTS

36

SIFY TECHNOLOGIES

Thank you

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