the presentation material also includes selected financial
TRANSCRIPT
Sify Ltd.Investor Presentation
From time to time, we make presentations to investors, analysts, the media and other persons interested in our company. The present form of presentation that we are using is attached. The contents of this presentation include forward-looking statements that were and are made in express reliance on the safe harbor provisions contained in Section 21E of the Exchange Act and Section 27A of the Securities Act. Such statements include, without limitation, statements relating to results deemed to be achievable by our management in future periods, as well as with respect to trends in sales performance, gross margin, selling, general and administrative costs, market growth, the competitive environment, and other factors affecting future sales, operating results, and capital requirements. Sales and operating results trends are also affected by many other factors, including, among others, world and national political events, general economic conditions which recently have been weak, the effectiveness of our promotion and marketing strategies, and competitive factors applicable to our corporate and consumer markets.
The presentation material also includes selected financial measures that constitute “non-GAAP” data under the Securities and Exchange Commission’s rules, particularly including our calculation of earnings before interest, taxes, depreciation and amortization, or Ebitda.
Sify Ltd.Investor Presentation
A derivation of Ebitda and a reconciliation of that calculation to the GAAP data that we believe to be most comparable is provided in our recent reports on Form 6-K or 20-F filed with the SEC. These reports can be accessed on our website or on the SEC’s Edgar database (www.sec.gov)
The statements furnished in this presentation must be viewed in context and in light of the risks described above and under the caption “Risk Factors” contained in our most recent reports on Form 6-K or 20-F filed with the SEC. In light of these risks, there can be no assurance that the forward-looking statements furnished in this presentation will in fact be realized. The statements made in this presentation speak as of its date only, and it should not be assumed that the statements made herein or therein remain accurate as of any future date.
SIFY DOES NOT PRESENTLY INTEND TO UPDATE THESE STATEMENTS AND UNDERTAKES NO DUTY TO ANY PERSON TO EFFECT ANY SUCH UPDATE UNDER ANY CIRCUMSTANCES.
Sify Ltd.Investor Presentation
Any failure to successfully implement our operating strategy or the occurrence of any of the events or circumstances set forth in this presentation or the referenced Risk Factors could result in the actual operating results being different than the projections, and such differences may be adverse and material.
* * * * * * * *
Making the Internet Work
for You
July 2007
Internet Users in India: Fastest growing
in Asia
2006E Internet
Users ( Million)
31 17 7 126 9 37
0%
5%
10%
15%
20%
25%
30%
35%
40%
20
03
-20
06
E In
tern
et
Us
ers
CA
GR
India Philippines Indonesia China Thailand Korea
Source: IDC
• Fastest growth rates in the region
• Rapid infrastructure improvements
Indian Internet Users expected to grow to 100 Million
over the next 3 years from estimated 42 Million in Mar
2007 .
Internet & Online Association
Government’s Broadband Policy Target: 20 MM
subscribers by 2010
E-Gov Initiatives gaining momentum
Information Services available online
Growth of IT Spending in India
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
US
D B
illio
n
2003 2004 2005 2006 2007 2008 2009
17% 23% 23% 18% 17% 15% 14%
Domestic demand for IT in India is witnessing a gradual transformation from being predominantly hardware driven towards a solutions oriented approach-resulting in an emphasis on services.
Source: Nasscom – IDC Report
Strong IT – ITES Growth Projected
8.3
10.2
12.4
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
FY 2004 FY 2005 FY 2006
23%
22%
Domestic growth trends
7.3
10
13.2
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
FY 2004 FY 2005 FY 2006
Offshoring growth trends
Revenues $ Billion
Source : NASSCOM
37%
32%
• Offshore Infrastructure Management Services
expected to grow to $ 1 Billion in 3 years
• Domestic demand driven by IT/ITES
Sify is well positioned to leverage the
projected exponential growth of
Internet usage as well as internet based services.
Catalysts of the Internet for positive change
Enterprise
Services
Consumer
Internet
Experience
Technology Core
Network Data Centers Systems
Leveraging IP expertise
Technology Core Competence
“To become the global provider of choice by pioneering
technology and offering innovative customer centric
internet solutions thereby creating value for the
customer”
Sify’s Technology is ISO 9001-2000, BS7799 certified & appraised CMMi Level 3
The Sify Edge:
Infrastructure - India Network
A World class design and service standards network to deliver
Consumer Internet Experience
Enterprise Technology Services
Network coverage extends to 200
cities
Our Network is IPv6 and MPLS
enabled with redundancies
A Converged network:
Voice,Video & Data capability
Future proofed to meet strong
demand from IT/ITES and other
verticals
The Sify Edge :
Infrastructure – Redundant Global Connectivity
State-of-the-Art Network Management
Integrated Trouble Ticketing
Proactive Alerts
Standards Based
NMS
Trouble
Ticket Engine
Knowledge
base
Change
Workflow
Threshold
Monitoring
Service Level
Agreements
Escalation
Engine
Configuration
Baselines
Incident
Management Problem
Management
Change
Management
Capacity
Management
SLA
Management
Service
Desk
IT Service
Continuity
Management
Availability
Management
Reports
Engine
CIO Dashboard
Software
Inventory Path Management
NMS Alerts
C M D B
C M D B
IT Information Library
Common pool of technology talent across businesses
World Class Processes
ISO 9001 – 2000 Certification
› Enterprise Solutions Business, Technology, and Customer
Care
Maturity Level 5 (CMMI-SW version 1.1)
› Technology development units apprised at Maturity
Level 5 of the Capability Maturity Model Integration
(CMMI-SW version 1.1)
Information Security Certification
› First Data Center complying with ISO 27001
Integrated Consumer Experience
No one else has it !
•com
Internet access: Huge Unrealized Potential
60% of Internet Users access the Internet
from Public Internet Access Points
PC Owners
287 461732
1,0731,550
1,886
2,550
3,500
-
1,000
2,000
3,000
4,000
1997
- 98
1998
- 99
1999
- 00
2000
- 01
2001
- 02
2002
- 03
2003
- 04
2004
-05
Source : IMRB – 2004 Report.
That’s because Home PC ownership
is estimated at 6 million plus in
2006. Even with projected growth
of over 30% (IDC) this would still be
only 12-13 million.Total no of
homes in India is 210 million
Large Opportunity in Public Internet Access
The World’s Largest Franchised Cyber-café Chain
We single handedly created the branded public
internet access services industry in India by:
Taking Internet to the people with a franchised chain
Currently 3700+ cafes in 163 cities, and growing
The undisputed No 1 in branded public Internet access
Delivering a superior Consumer Internet Experience
High speed access across the chain
: Categories & Services
Internet : Browsing,Voice,Games
E commerce : IRCTC,Utility bills,Money transfer etc
E entertainment : GameDrome,Sifymax
E shopping : Sify mall
: Categories & Services
E learning : Microsoft certificate , Internet Access for
Microsoft IQ PC , Microsoft Office products
training at iWays, iWay as virtual office
“ As part of our strategy to use the iWays to empower Indians
with Internet and IT services, We have partnered with
Microsoft India to help bridge the digital divide in India “
Growth
0
500
1000
1500
2000
2500
3000
3500
4000
Q1 0506 Q2 0506 Q3 0506 Q4 0506 Q1 0607 Q2 0607 Q3 0607 Q4 0607 Q1 0708
No
of
iWa
ys
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1300
Su
bs
cri
be
r M
illi
on
s (
3 m
on
ths
ac
tiv
e)
iWays Subscribers
Vision
Our vision is to be an integral part of the Indian
middle class family’s Internet experience
Consumer Touch Points:
to Homes
High Speed Internet Revolution for homes
› Pioneered unique model with Cable TV operators (CTOs) for
last mile connectivity
› Currently the largest private player with more than 200,000
subscribers
› Potential of 80 Million Cable TV households
› Cable TV homes more likely to buy home PCs
› Iways users who buy home PCs can remain Sify customers
› Aggressively growing base
Technology Innovation :
› Service Provider with wireless broadband technology
› Developed own client to ensure PC hygiene and push
updates to consumers at home (eg Anti Virus).
CUG Phone for Subscribers
Mathguru , Class teacher & MBD Alchemie
IRCTC tie up for Railway Tickets through
partners(CTOs)
Roaming access to users : Sify Anywhere
VOIP for International Calls.
PC health solutions.
Value added Services
104.8
124.7
150.5
183.0191.1
208.8 209.0215.5
208.1
0
50
100
150
200
250
Q1 0506 Q2 0506 Q3 0506 Q4 0506 Q1 0607 Q2 0607 Q3 0607 Q4 0607 Q1 0708
Su
bs
cri
be
rs (
00
0s
)
Subscribers
growth trends
Internet Content enhancing Consumer
Experience
Driven by
› High Speed Broadband
› Rich broadband content
Betting on broadband!
Betting on youth !
India & the Internet
40 Mn internet users
Estimated to be 50 Mn by March’08
Internet penetration at 3.5% of population
Smaller cities & towns record 142% YOY growth
25% users from smaller towns
Over 20Mn NRI’s estimated world over
Source:IAMAI & Internetworldstats
Internet Content enriching Consumer
Experience
Entertainment
› Online Games, Movies, Music Videos
› Association with Indian Television : Indian Idol, MTV Roadies,
Fame Gurukul, Saregamapa
Internet Content enriching Consumer
Experience
Education
› Tie up with Educational Institutions
› E Learning (Computer Based Training)
› Online tests
Sify.com-Regional languages
Sifymax.in-City Centric Portals
Samachar.com
Portals growth
0.8
1.0
1.2
1.4
1.6
1.9
1.7
1.1
1.7
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
Q1 0506 Q2 0506 Q3 0506 Q4 0506 Q1 0607 Q2 0607 Q3 0607 Q4 0607 Q1 0708
Re
ve
nu
es
( U
SD
Millio
n )
Revenue
1 $ = Rs 40.58
Integrated Enterprise Services
Managed Network Services
› IP/VPN
› Global MPLS
› Internet & bandwidth
› VoIP & Converged Network Services
Managed Datacenter Services
› Managed Servers
› Managed Mail
› Application Hosting
Security Services
Network Operations Management
Datacenter Operations
Management
Security Operations Management
Application Performance
Management
Desktop Management
Helpdesk
Offshore Services Managed Services
Key Verticals Served
› IT/ITES- BFSI - Consumer Telecom -Life Sciences
› Manufacturing - Retail -Energy - Government
Sify Enterprise Services - Profile
Expertise in delivering mission critical 24x7 technology
services
Leader in India by far- IDC
Over 1700 clients, including 400 global companies
Among top providers in Forrester Wave for Offshore
Infrastructure Management (2005)
Scalable infrastructure
Case Study : Hosting & Managed services
Client
› RxMD, NJ USA & Chennai , India
› Managed by US Board Certified and Licensed Physicians
Service
› Hosting Services, Managed services,DR solution & Storage services
Challenge
› Highly secured
› Infrastructure complaint with US & EU regulations
› Scalable architecture
› OS & DB administration 24 x 7
Benefits
› Single point solution offering end to end solution starting from Hardware
Procurement , Implementation and continuous support
› DR server up in 24 hours as per RxMD’s requirement by using unque Sify
solution.
› Quick Implementation meeting stringent client deadlines
› Guaranteed 99.6 % uptime for Network and Infrastructure
Case Study : International MPLS Services
Client
› Whirlpool India Limited
Service
› International MPLS Services
› Accessing servers in US from office in INdia
Challenge
› Shifting of application servers to Michigan , US
› High uptime commitments in the network
› Redundancy on the network
› Highly flexible and scalable network solution
› End to End Security
Benefits
› High uptime reliable network
› Strong security feature
› Automatic route distinguishers to provide traffic separation
Case Study : VPN Connectivity
Client
› Globus Multi location retail store.
› Changeover to Sify from TELCOs
Service
› VPN Connectivity with high last mile uptime
Challenge
› Integrating Network
› High last mile uptime
Benefits
› High uptime on entire network including Last mile
› Faster implementation
› 30-40 % reduction in costs
Case Study : Document Management
Client
› DLF Group is a leading name in India’s real estate Industry
Service
› Document Management & Scanning services
Challenge
› Documents centrally stored in Corporate office Delhi. Hindering
productivity as it requires physical travel between locations for document
retrieval.
› Documents (Legal Documents, Drawings) are to be maintained for long time
and is also exposed to wear & tear
Benefits
• Fast searching and retrieval of the documents and drawings
• Enterprise wise access to the documents
• Documents available on one click of a button
• Back up to the physical documents
• Wear & tear of the documents and drawings was reduced
Growth of Enterprise Services
13.2
15.4 15.5
17.818.5
19.119.8
21.0
16.7
0
5
10
15
20
25
Q1 0506 Q2 0506 Q3 0506 Q4 0506 Q1 0607 Q2 0607 Q3 0607 Q4 0607 Q1 0708
Re
ve
nu
es
( U
SD
Millio
n )
Revenue
1 $ = Rs 40.58
Enterprise Services - International
•
•eLearning content services
• Content Mgmt
• Learning Technology Services
Enterprise
Infrastructure
Services
Enterprise
eLearning
Services
• Infrastructure Management
• Infra Projects / Consulting
• Security Consulting
• Managed Security Services
• Hosting Services
• Enterprise Appln Management
Sify Infrastructure Services - Focus
N/W Mgmt Server Mgmt
Infrastructure
Application
Support
Security
Opera
tions
Su
pp
ort
Our Domain
THE SIFY EDGE
SPECIALIST IN
REMOTE
INFRASTRUCTURE
MANAGEMENT
SERVICES
EXPERIENCE
ENGAGEMENT
GOVERNANCE
EXPERTISE
PROCESSES
SERVICE
INFRASTRUCTURE
Value Proposition
MULTI LEVEL ENGAGEMENT VALUE
Impact on Business Strategy
Process
Business
•Cost reduction
savings to 50%
•Enhanced Customer
Satisfaction : Pro-
active approach
• Enhanced Productivity
- ITIL Best Practices
• Reduced Noise Levels
- Root Cause Analysis
with Six Sigma
•Business Service
Management
•Business Impact
Analysis
Operations
“Sify Is Best Suited For Discrete Offshore
Remote Management”
Forrester Wave TM : Global Delivery Infrastructure
Management – December 2005
15.3
30.2
38.9
49.1
69.0
89.0
115.4
136.0
-10
10
30
50
70
90
110
130
US
D M
illio
n
1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
1 $ = Rs 40.58
A history of robust topline growth
1 $ = Rs 40.58
EBITDA
-24.2
-11.9
2.1
5.6
7.1
11.9
-35
-30
-25
-20
-15
-10
-5
0
5
10
15U
SD
Million
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
1 $ = Rs 40.58
Net Income
-177.5
-32.8
-9.1 -7.6-3.7
3.7
-180
-160
-140
-120
-100
-80
-60
-40
-20
0
20U
SD
Mil
lio
n
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07
*Net Profit included USD 3.2 Mln on account of Profit on Sale of Land & Cricinfo
*
Sify – The Opportunity
To leverage: › Large services opportunity in Indian and Global
markets
› Proven scalable business models in Access Media
Portals
Enterprise Services
› Leveraging Technology platform for scale and expertise
› Capable people
› Cash to fuel growth
Equity Structure ( Undiluted )
No of Shares 42,808,852
As of 30th Jun 2007
Infinity Capital
41.82%
ADR s with Public
58.18%
Others
0.002%