Suyog Telematics Ltd Management Discussions

Economic Overview

In 2024, the global economy demonstrated resilience and steady recovery from the pandemic disruptions of prior years. Despite persistent macroeconomic challenges and geopolitical tensions including the Russia-Ukraine war, the prolonged Israel-Gaza conflict, global tariff uncertainties, and inflationary pressures the world economy-maintained momentum with an estimated GDP growth of around 2.6%. Both developed and emerging markets are showing signs of stabilization, supported by structural reforms, supply chain diversification, and increased adoption of digital technologies. Indias macroeconomic environment remains strong, driven by robust domestic demand, higher public and private sector investments, and continued momentum in manufacturing supported by global supply chain realignments. The country has also witnessed one of the fastest growths in manufacturing PMI, supported by infrastructure development and rising consumer disposable income fuelling the retail market. With these factors, India is expected to remain the fastest-growing major economy, with real GDP growth projected at 6.4% in FY25, significantly outpacing global averages.

The passive telecommunications infrastructure industry in India forms the backbone of the countrys digital connectivity.

Tower and fiber assets enable seamless delivery of mobile and broadband services, supporting the rapid growth of data consumption and digital applications. With the rollout of 5G networks, demand for tower sites, fiberization, and small-cell infrastructure has accelerated, particularly in urban and semi-urban areas. Passive infrastructure providers operate on a neutral-host model, offering long-term tenancies to multiple telecom operators, ensuring scalability and cost efficiency. Government initiatives such as Digital India and Bharat-Net are driving deeper network penetration into rural and remote areas. Rising investments in fiber-to-the-home (FTTH), smart cities, and lot further strengthen sector prospects. Despite challenges of high capital intensity, regulatory complexities, and pressure on operator profitability, the sector offers stable cash flows and predictable revenues due to long-term service agreements. With data demand projected to rise exponentially, passive telecom infrastructure providers remain central to Indias digital growth journey. The Indian telecom sector is entering a transformative growth phase, driven by surging data demand, accelerated 5G rollouts, and government-led initiatives aimed at bridging the digital divide. With digital consumption expected to multiply significantly over the next decade, demand for tower sites, fiber networks, and small-cell infrastructure will continue to expand. Passive infrastructure providers are set to benefit as telecom operators increasingly rely on shared infrastructure models to optimize costs, enhance coverage, and improve capital efficiency.

Suyog Telematics Limited is strategically positioned to capitalize on these opportunities. The Companys diversified portfolio of towers, small cells, and fiber assets, supported by long-term service agreements, provides a resilient revenue base with predictable cash flows. Its focus on government-owned locations and low-risk high-utilization sites further enhances growth visibility. With the integration of Lotus Tele Infra, Suyog has expanded its presence into the critical Delhi-NCR market, strengthening its pan-India footprint.

Looking ahead, Suyog will continue to prioritize fiberization, high-power small cell deployment, and efficient asset utilization to support the needs of telecom operators in both urban and rural markets. Its customer base of leading telecom companies, coupled with robust project execution capabilities, positions the company to be a key enabler of Indias digital transformation. Backed by scalable operations and a strong pipeline of opportunities, Suyog Telematics is well-placed to deliver sustainable value to stakeholders in the years ahead.

Suyogs with more than 30 years of expertise in constructing telecom towers, coupled with its specialization in cost-effective and swiftly deployed infrastructure, gives the Company a strong presence in the market and sets it apart from competitors.

? Suyog holds an IP-1 license, specializing in providing telecom infrastructure.

? The Companys installed towers are operational covering 26 states and union territories, aligned with a PAN

? Suyog has the highest number of government sites, including MMRDA, NHAI, BEST, Monorail, JNPT, MCGM, and more, underscoring its strong presence in government projects.

? Suyog is engaged with diverse telecom operators including Bharti Airtel, Reliance Jio, Vodafone Idea, and BSNL.

? Suyog has over 7,100+ tenancies across a diverse portfolio, including slum sites, flyovers, skywalks, foot over bridges, BEST, Monorail, CCTV, Macro Sites, Small Cell, and ULS sites, highlighting the breadth and diversity of the companys tenancy portfolio.

? Regulatory Environment: The industry is highly regulated and any adverse changes in government policies, spectrum pricing, or telecom sector regulations could impact operator investments and, consequently, infrastructure demand.

? Capital Intensity: Tower and fiber deployment require substantial upfront investments. Rising input costs and interest rate fluctuations may impact cash flows and project returns.

? Cybersecurity & Data Privacy: With growing integration of digital platforms, risks related to cybersecurity threats and data security compliance are increasing.

Suyog actively mitigates these risks through a diversified client base, long-term Master Service Agreements with built-in escalations, strategic focus on government-owned sites, and prudent financial management. Continuous investment in innovation, small-cell deployment, and fiberization further strengthens the companys resilience to industry shifts.

? Revival of Bharat Sanchar Nigam Limited (BSNL) & Vodafone Idea Limited (VIL)

The revival initiatives of BSNL and VIL, supported by substantial government reforms and capital infusion, present a significant growth opportunity for the passive telecom infrastructure industry. The Government of India has extended multiple revival packages to BSNL, including a 69,000 crore package in 2019, a 1.64 lakh crore package in 2022, and a further 89,047 crore package in 2023, covering spectrum allocation, debt restructuring, and capital expenditure support. In addition, 6,982 crore of CapEx has been approved in 2025 to accelerate BSNLs nationwide 4G rollout. Similarly, VIL has been supported through the conversion of 36,950 crore of spectrum dues into equity, enabling financial stability and network investment. With both operators accelerating network expansion, modernization, and 4G/5G rollouts, demand for tower and fiberized infrastructure is expected to rise meaningfully. Suyog, with its proven expertise in tower solutions and fiberization, is well positioned to capitalize on this opportunity. These revival measures are expected to enhance tenancy levels, improve utilization of existing assets, and unlock sustainable long-term revenue growth for the Company.

? Massive 4G Maro Site Rollout planned by BSNL

The large-scale 4G Maro Site rollout planned by BSNL is expected to be a key growth driver for the industry. Aimed at strengthening coverage and service quality across India, this initiative will significantly increase demand for towers and allied infrastructure. Importantly, the rollout will also serve as the groundwork for BSNLs future 5G deployments. With its strong capabilities in building and managing passive infrastructure, Suyog is strategically placed to capture this opportunity. The project is anticipated to boost tenancy ratios, improve asset productivity, and provide long-term visibility of revenues.

? BSNLs 5G Rollout Opportunity

BSNLs expected launch of 5G services within the next two years is likely to accelerate both Macro and Small Cell rollouts at an unprecedented scale. Beyond the creation of new sites, this expansion will open opportunities to increase tenancy on existing Small Cell infrastructure. Suyog, leveraging its robust expertise in tower assets and fiber connectivity, is well equipped to support this transition. The anticipated surge in demand from BSNLs 5G rollout is expected to strengthen tenancy ratios, enhance asset utilization, and unlock sustainable long-term growth opportunities for the Company.

? High-Power Small Cell Infrastructure for the Advent of 5G Technology

As 5G technology continues to roll out globally, the demand for high-performance, reliable, and efficient network infrastructure is increasing. High-power small cell infrastructure plays a crucial role in this evolution, addressing the need for enhanced connectivity and network performance in the face of 5Gs advanced requirements. High-power small cells enhance network coverage and capacity, especially in dense urban areas and high-traffic locations. They deliver faster data rates and low latency, crucial for 5G performance and applications like VR and IoT. By efficiently reusing spectrum and operating in higher frequency bands, they improve overall network efficiency. Their rapid deployment and scalability make them a cost-effective solution for expanding network infrastructure and meeting growing connectivity demands.

? Revolutionary FTTH Empowering Homes with Unprecedented 5G Speed

? Fiberizing Mobile Towers for Accelerated 5G Deployment

? 5G Connectivity to Rural Villages through RLS Sites

? Electromagnetic Field (EMF) emissions

? Renewable Energy Solutions: Installation of wind turbines at select telecom towers on a trial basis to reduce electricity costs. This initiative is expected to lower operational expenses for telecom operators and improve Suyogs cash flows through energy savings.

? FTTH Innovations: Development of vertical wiring solutions for FTTH installations within ducts, enabling optimized space utilization, faster installation efficiency, and enhanced service delivery.

? Advanced Power Backup Systems:

? Next-Gen SMPS Development: Designing a low-cost, highly efficient Switch Mode Power Supply (SMPS) system tailored for multi-operator tower sites to improve energy efficiency and reduce maintenance costs.

During the year under review, the equity shares of the Company were successfully listed and admitted for trading on the Main Board of the National Stock Exchange of India Limited (NSE) with effect from August 20, 2024, under the symbol “SUYOG”. This development marks a significant milestone in the Companys growth journey, as the listing on NSE, in addition to the existing BSE listing, is expected to enhance visibility in the capital markets, provide wider access to investors, improve liquidity of the Companys shares, and create long-term value for all stakeholders.

During the financial year under review, the Company successfully executed the acquisition of 95% equity stake in Lotus Tele Infra Private Limited (“Lotus” or “Subsidiary”), a Delhi NCR based passive telecom infrastructure firm, for a cash consideration of approximately Rs. 13.5 crore. The agreement, initially contemplated through a binding Memorandum of Understanding on December 26, 2024, led to the formal completion of the acquisition on March 31, 2025, resulting in Lotus becoming a subsidiary of the Company. As of March 31, 2024, Lotus had reported a turnover of around Rs. 13 crore. This strategic move expands Suyog Telematics footprint in the critical Delhi and NCR regions by adding 120 telecom sites and enhancing service delivery capabilities across its infrastructure portfolio.

Risk management and internal control are fundamental to effective corporate governance and development of a sustainable business. The Company has a robust process to identify key risks across its operations and prioritize relevant action plans that can mitigate these risks. Key risks that may impact the Companys business include:

A significant change in the governments policies, commodity pricing and other global and domestic macro factors, could affect business and economic conditions in India. Issues such as tax changes, impact of litigations or new taxes or levies; could lead to significant financial exposure, loss of reputation or disruption of business.

The Companys telecom networks are subject to risks of natural disasters or other external factors. The Company maintains insurance for its assets, equal to the replacement value of its existing telecommunications network, which provides cover for damage caused by fire, special perils and terrorist attacks. Such failures and natural disasters even when covered by insurance may cause disruption, though temporary, to the Companys operations. The Company has been investing significantly in business continuity plans and disaster recovery initiatives which will enable it to continue with normal operations and offer seamless service to our customers under most circumstances.

New technologies can also lead to obsolescence of telecom towers. We dont foresee any risk in the near future and the Company keeps assessing all the new technological advancements in the sector for better understanding and preparedness.

Companys operations, safe keeping of its assets, prevention and detection of frauds and errors, optimal utilisation of resources, reliability of its financial information and compliance. Systems and procedures are periodically reviewed by the Audit Committee to maintain the highest standards of Internal Control. During the year under review, no material or serious observation has been received from the Auditors of our Company citing inefficiency or inadequacy of such controls. An extensive internal audit is carried out by M/s. DBS & Associates, Chartered Accountants and post audit reviews are also carried out to ensure follow up on the observations made.