Netweb Technologies India Ltd (NETWEB) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator: Your pass code has been confirmed. Please wait while you are joined to the conference. The conference is now being recorded.
Moderator: Ladies and gentlemen, the conference will begin shortly. Please stay connected. Thank you.
Moderator: Ladies and gentlemen, good day and welcome to Netweb
Moderator: Technologies Q2 FY '27 earnings conference call hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Seema Nayak from ICICI Securities. Thank you and over to you, Ms. Nayak.
Seema Nayak (ICICI Securities): Thank you. Good afternoon everyone. On behalf of ICICI Securities, I welcome everyone to Netweb Technologies Q2 FY '27 earnings call. We have with us today the senior management team of Netweb Technologies, led by CMD Mr. Sanjay Lodha, Full-time Director Mr. Navin Lodha, CFO Mr. Ankit Kumar Singhal, Chief Sales and Marketing Officer Mr. Hirday Vikram, Chief Strategy Officer Mr. Mukul Kedia, and Head of Waters Advisors, the IR advisor to Netweb Technologies, Mr. Sanjeev Sancheti. So without further delay, I'd like to hand over the floor to Mr. Sanjay. Over to you, sir.
Sanjeev Sancheti (Waters Advisors): Thank thank you, Seema. Good afternoon to all the participants. Before I hand over the call to Mr. Sanjay Lodha for the opening remarks, I would like to draw your attention to the Safe Harbor statement in the earnings presentation. I request each one of you to go through the disclaimer in that presentation before the meeting starts, so that you're aware of the same. Thank you, and over to you, Mr. Lodha.
Sanjay Lodha (Netweb Technologies India Ltd): Thank you, Seema and Sanjeev. Good afternoon and a warm welcome to all of you to Netweb Technologies Q2 financial year '27 earnings call. We are pleased to report that Q2 financial year '27 has been another record-breaking quarter for Netweb Technologies, with our highest ever quarterly revenue from operations and profit after tax. Both revenue and profit grew 4x year-on-year. H1 financial year '27 PAT reached 222 crores, surpassing our full year financial year '26 PAT of 206 crores in just 6 months. In Q2 financial year '27 revenue from operations grew at the rate of 335.7% year-on-year to 1,323 crores. Operating EBITDA increased from increased by 334% year-on-year to 197 crores, with a margin of 14.9%, where whereas PAT rose from 348.8% year-on-year to 137 crores, translating into a margin of 10.2%. Our ability to sustain margin while scaling rapidly reflects reflects strong execution and operational discipline amid rising demand for high-performance computing and AI infrastructure. AI systems remained our primary growth driver, contributing 773 crores or 58.4% of revenue from operations, registering a growth of 1,068% 68.1% year-on-year. HPC and Private Cloud also delivered robust performance, contributing 248 crore and 245 crore respectively, highlighting the strength of our diversified growth portfolio. As on September 30th, 2026, our our order book stood at 2,629 crores, with an additional L1 position of 653 crores, providing strong revenue visibility for the coming quarters. The quarter also marked a significant milestone in our journey, where we successfully raised Rs. 1,200 crores through our first capital raise since listing in July 2023. We are grateful to our investors for the overwhe- overwhelming response and continued confidence in our business, growth strategy, and long-term potential. Moving to the industry landscape, we continue to witness an unprecedented precedented surge in global demand for AI compute, with India emerging as a significant growth market. The IndiaAI Mission represents a major structural tailwind for the domestic AI ecosystem, with the potential to accelerate development of indigenous AI capabilities, expand access to advanced computing infrastructure, and strengthen India's AI sovereign AI capabilities. Government bodies, public institutions, and large enterprises increasingly view computing infrastructure as strategic infrastructure, prioritizing secure, high-performance systems that enable critical data and workloads to remain within the country while optimizing the AI token economics. Achieving cost-effe- effective token generation requires more than access to acce- to advanced compute. It also demands strong in-
Sanjay Lodha (Netweb Technologies India Ltd): and system design and solutioning capabilities. Netweb has invested in developing these capabilities over the years, positioning us to address the evolving requirements of this market. Global service providers, CSPs, global cloud service providers, CSPs, data center operators, enterprises are expanding their GPU intensive infrastructure, meet the growing computational demand for AI training, inference and other AI driven applications. India is emerging as an important destination for these expansion plans, creating an additional opportunities across high end computing ecosystem. These developments together with growing need for indigenous computing capabilities and end-to-end technology stacks are reinforcing the importance of sovereign compute infrastructure. With our integrated design and engineering capabilities, in-house manufacturing, and end-to-end solution deployment expertise, Netweb is well positioned to address these requirements. Our strategies across supercomputing and private cloud have also delivered excellent results, further validating our capabilities and market positioning. Furthermore, as National Supercomputing Mission 2.0 places greater emphasis on designing and building compute infrastructure in India and HPC adoption across enterprise, indigenous design and manufacturing, along with bespoke solutioning, are becoming increasingly important differentiators in higher in the high end computing landscape. We believe these structural drivers will support a sustained growth cycle and high end computing space. Our active pipeline of approximately 11,152 crores represents the total value of business opportunity currently under pursuit, and serves as an indicator of demand visibility. It is important to distinguish this pipeline from our total addressable market, that is a TAM, which is significantly larger and represents broader market opportunity available to Netweb. Together, these forces reinforces our confidence in growth opportunities ahead. Beyond our core business, we continue to explore emerging opportunities in physical AI and quantum computing, leveraging our technological expertise and established capabilities. As communicated earlier, we are advancing initiatives in both these areas. In physical AI, we are developing capabilities across technology stack, leveraging our AI systems, digital twins, in-house software support, training, simulation requirements. In quantum computing, we have commenced R&D on quantum simulators and emulators and are engaging with institutions, hubs, and startups across ecosystem. Further for further strengthening our focus on technology development, our board has also approved the establishment of a wholly owned subsidiary of Netweb in Taiwan for advancing our R&D efforts. This is an important step towards deepening R&D in IT hardware and strengthening our technological capabilities as in as India's leading technology OEM. We believe this initiative will further support our pursuit in innovation and our ambi- ambition to design and manufacture advanced computing solutions in India. As a leading Indian OEM in the high end computing solutions, we continue to invest steadily in innovation and chip-agnostic design phi- philosophy. Our alignment with Make In India vision, a stronger balance sheet with our recent capital raise, and a robust order book position us well to capture growing demand for high end computing, deliver sustainable long term growth, and create love lasting value for stakeholders. I will now request Ankit to take you through the financial performance in great detail. Thank you.
Ankit Kumar Singhal (Netweb Technologies India Ltd): Thank you, Mr. Lodha. Good afternoon ladies and gentlemen, and thank you for joining our earnings call. Before we open the floor for Q&A session, I would like to provide a brief overview of our financial performance for the quarter and the first half of FY '27. I trust you have had the opportunity to review our earnings presentation and press release. Let me begin with our quarterly performance. Revenue from operations for Q2 FY '27 stood at ₹1,323 crore, registering a year-on-year growth of 335.7% and a quarter-on-quarter growth of 61.4%. Operating EBITDA for the quarter stood at ₹197 crore, increasing 334% year-on-year and 63.7% quarter-on-quarter. The operating EBITDA margins stood at 14.9%, reflecting our ability to sustain profitable Profit after tax for Q2 FY '27 stood at ₹137 crore, growing 334.8% year-on-year
Ankit Kumar Singhal (Netweb Technologies India Ltd): and 60.2% quarter-on-quarter. The PAT margin for the quarter stood at 10. 10.2%. Moving to our first half performance. Revenue from operation for H1 FY '27 reached ₹2,143 crore, representing year-on-year growth of 254.2%. Operating EBITDA stood at ₹323 crore, growing 257.7% year-on-year with a margin of 15.1%. PAT increased 258.5% year-on-year to ₹222 crore with a margin of 10.3%. Our first half performance reflects strong business momentum supported by robust demand across our core segments and disciplined execution. Notably, our H1 FY '27 PAT has already surpassed our full year FY '26 PAT, underscoring the scale of our growth. Turning to our balance sheet, we achieved a zero net debt position during the quarter with net cash position of ₹14 crore as of September 2026. In addition, the company had approximately ₹403 crore unutilized from the QIP proceeds. This improved financial position supported by our recent capital raise provide us with greater financial flexibility to fund our growth plans. Our cash conversion cycle stood at 94 days with receivable days improving to 62 days while inventory days stood at 117 days. The relatively higher inventory levels are intentional and reflect our preparation for executing the order book of approximately 2,629 crore as of September 2026. Given the strong global demand for high performance computing and the strategic performance importance of these deployments proactive supply chain planning and availability of critical component are essential to ensure timely execution of customer orders. Our return on equity and return on capital employed stood at 31.4% and 38.6%, respectively. These ratios reflect the impact of QIP proceeds on our capital base. Coming to the utilization of QIP proceeds, we had utilized ₹767 crore of the proceeds as of September 2026. We remain grateful to our investors for their overwhelming response to the QIP and their continued confidence in the Netweb's growth strategy and long-term potential. To conclude, our growth priorities remain firmly on track, supported by healthy order book, a strong pipeline of business opportunities and sustained demand for high-end computing solutions. We remain focused on scaling our business, executing customer order efficiently, and maintaining operating discipline and profitability. With that, I would like to conclude my remarks and invite the moderator to open the floor for Q&A. With this, I now hand over the call to Seema.
Seema Nayak (ICICI Securities): Thank you. We will now open the floor for questions.
Moderator: Thank you.
143 more turns of this transcript: log in to Stocksigma to read the full call.