#1Investor Presentation October 2020 TATA TATA COMMUNICATIONS#2Index Business overview Strategic overview Our key stakeholders 3 15 21 Performance highlights 24 TATA TATA COMMUNICATIONS#3Business overview ΤΑΤΑ TATA COMMUNICATIONS#4Introduction We are Tata Communications A digital ecosystem enabler, part of India's multibillion-dollar conglomerate, the prestigious Tata Group. We enable the digital transformation of enterprises, globally - unlocking opportunities for businesses by enabling borderless growth, boosting product innovation and customer experience, improving productivity and efficiency, embedding agility and managing risk. Both today and in the future. With a customer solutions orientated approach, proven managed service capabilities and cutting edge infrastructure, we drive the next level of intelligence powered by cloud, mobility, lot, collaboration, security and network services. 12,000+ employees worldwide 200+ countries of operation 50+ entities across the globe 37+ diverse nationalities ~7,000+ customers (including 300 of the Fortune 500) Top percentile of NPSⓇ 4 TATA COMMUNICATIONS#5Introduction Providing connectivity to the world 30% Global internet routes carried by us #1 Enterprise data and colocation services in India 60% Cloud giants are connected to their businesses through us 4 of 5 Global mobile subscribers connected through our network Leader In Gartner's Magic Quadrant for Network Services (Global) - 2020 7 years in a row #1 Wholesale voice provider submarine cable owner on-net mobile signaling (globally) 5 TATA COMMUNICATIONS#6Key Performance Indicators Numbers that matter Our voice business continues to be strong and our data business remains instrumental to our overall revenue. As we grow scale, we are confident of an upward momentum in our profit trajectory in the coming quarters. 6 Revenue (Rs. in crore) 759 4,401 Data Voice 3,642 EBITDA (Rs. in crore) 50 1,158 TCL Consolidated figures for Q2' FY 21 Rs. 384 crore PAT Rs. 318 crore CAPEX 1,108 2.3 times Net debt/EBITDA TATA COMMUNICATIONS#7Our evolution Transformation is in our DNA 2002 Tata group acquires 25% stake in VSNL (India) 2005-06 . • Acquired Tyco . and Teleglobe, establishing a global presence Launched next- generation dedicated global Ethernet service connecting North America, Europe and Asia • 2008 Established as Tata Communications Diversified into enterprise segment 2010 Launched managed services portfolio for enterprises 2014 Launched the most comprehensive cloud enablement platform, IZO(TM) 2017 Launched NetFoundry, a revolutionary SaaS start-up platform and MOVE(TM), a mobility and IOT platform 2018-20 Getting ready for the next wave of growth as a global digital ecosystem enabler Inception Diversification Innovation TATA COMMUNICATIONS#8What, why and how Tata Communications at a glance 8 Why we exist Deliver a new world of communications to the industry and our customers Boosting product innovation and customer experience Enhancing productivity and efficiency Building agility CUSTOMER DRIVERS Enabling borderless growth PLATFORMS AND EXPERIENCE COMMITMENTS How we do it Customer intimacy Sustainability Mobility and IOT Collaboration NetFoundry Next generation connectivity Cloud, edge and security ↑ Voice M Innovation Managing risk Services Wrap Artificial Intelligence Our DRIVE culture Daring | Responsive | Inclusivity | Venturing | Ethical TATA COMMUNICATIONS#9What we do Providing solutions for every stage of digital maturity Helping customers unlock opportunities through digital transformation - enabling borderless growth, boosting product innovation and customer experience, improving productivity and efficiency, building agility and managing risk. PHYSICAL Primarily out of a trading office ONLINE Internet trading through websites and mobile apps OMNI-CHANNEL Mobile apps, social media, online trading portals, client portals, tablet app DIGITAL Collaboration between physical and digital; cloud infrastructure CONTEXTUAL Highly customer-centric; real-time trading; AI/ML, Big Data and advanced analytics, etc. TATA COMMUNICATIONS#10Our customers We cater to multiple industries AUTOMOTIVE 10 10 I A MEDIA & ENTERTAINMENT SPORTS H MANUFACTURING PHARMACEUTICAL INSURANCE HEALTHCARE TELECOM BANKING CONSTRUCTION SERVICES FINANCE ENERGY RETAIL IT/ITES CONSULTING REAL ESTATE E-LEARNING E-COMMERCE GOVERNMENT TATA COMMUNICATIONS#11Our customers Representing some of the biggest brands 11 EUROPEAN Official Global SUZUKI Petrofac P TOUR Amway infor MARUTI Way of Life! FEDERAL BANK YOUR PERFECT BANKING PARTNER NIC Connectivity Supplier एनआईसी National Informatics Centre Hewlett Packard Enterprise ADITYA BIRLA FIS MANAPPURAM ale FINANCE LIMITED Make Life Easy GRASIM HDFC HOUSING DEVELOPMENT FINANCE CORPORATION LTD. TATA COMMUNICATIONS#12How we do it Our globally local digital infrastructure Vestmannair Hudson Bay Gentity Gulf of Alaska High Wycombe Bering Sea Hurmanty Parthcurno Pottington Pacific San Francis Ocean of Mexico Atlantic bban Sea Leanin Cape Ve • • Our end-to-end capabilities in servicing and delivery make us a preferred partner for businesses everywhere. All of our products and services are underpinned by our global network, the largest world's largest wholly-owned subsea fibre backbone and a Tier-1 IP network. MPLS POP IP POP United Kingdom O Redcar Scarborough Slough Whitesands Bas Stratford Ocean Transmission Pop Ethernet PoP CDN POP North Sea Mediterrane Sea Casplat Part TATA COMMUNICATIONS GLOBAL FOOTPRINT v12.5 Voice/VoIP POP Earth Station Data Center Partner PoP Chennai Cat Indlan Ocean Club Song Kong Sea of Okhatsk Chura tabbersk Sea of Japan (East Sea) thith Yellow Sea στην δη Mure Ninomiye Shima Tayabashi Dacifle Pngusan Pel Ma Ocean Great Australian Bight Tasman Sea Planned MPLS & Ethernet PoP Direct voice route, Tata network connectivity available IZO private hub GMX Hub (Global Media Exchange) Planned CDN POP Aggregation Pop Managed Hosting Colocation Tata network connectivity. available#13How we do it Our DRIVE culture We view our success as a result of the unstinting commitment of our people and their efforts. Our greatest asset? Our people. Can-do attitude Collaboration Continuous learning Innovation Mindset for growth and agility Ownership and accountability Problem solving Skills transformation . 90% Learning via digital mode in Tata Communications Learning Academy 5,300+ Certifications completed by employees with minimum 16 hours of effort Our people reflect our ethos 1,64,000 Lives impacted by our employees, through 59,184 volunteering hours as part of our CSR initiatives Certified as a Great Place to Work by Great Place to Work Institute (India, Hong Kong, Canada and USA) • . 'Best Workplaces in Asia' for the year 2019 (Hong Kong) 2019 Best Employer in India by Aon Best Companies for Women in India - Working Mother and Avtar • Best Workplaces for Women by Great Place to Work Institute (India and Canada) 13 TATA COMMUNICATIONS#14How we do it Our commitments Sustainability We strive to make a positive, tangible impact on the environment and wider society through our actions, and through our products & services for our customers. Innovation We continue to innovate to stay relevant for our customers as a long-term partner in their digital transformation journeys. 0+ Artificial Intelligence We are bringing enhanced focus on leveraging the power of Al and ML technologies and embedding a framework to make Al an integral part of our capability and offerings. 14 TATA COMMUNICATIONS#15Strategic overview TATA TATA COMMUNICATIONS#16Operating context Trends shaping the industry We facilitate businesses to pursue digital transformation through navigating new and emerging technologies, to transition seamlessly into a more intelligent future. Platform economy 7 of 10 Most valuable companies based on platforms (Source: Bloomberg and Google) Managed services 11.5% Growth of global managed services between 2018 and 2023 (Source: Mordor Intelligence) Enterprise mobility 6 billion Mobile subscriptions by 2025 (Source: GSMA Intelligence) Internet of Things (IoT) 79.4 ZB Data will be generated globally, by 41.6 billion loT devices by 2025 (Source: IDC) Cloud computing 28% Of the IT spending will shift to the cloud by 2022, affecting US$1.3 trillion (Source: Gartner) 16 Hybrid SDN 60% Of enterprises will have implemented SD-WAN by 2023 (Source: Gartner) Cybersecurity awareness 41.2% Growth in spending on cloud security over the next 5 years (Source: Gartner) Artificial Intelligence (AI) 37% of organizations adopted Al in some form in 2019 (Source: Gartner) TATA COMMUNICATIONS#17Market we address Our opportunity landscape While all areas of our portfolio are expected to grow, 6 key pillars have been identified to significantly contribute to our growth in revenue. Available Market 2023 17 MOBILITY & loT COLLABORATION Mobility & loT Collaboration CAGR +3.9% CAGR +12.2% 2022 $243Bn 2022 $35Bn 2019 $217Bn 2019 $25Bn Voice NetFoundry CAGR (6.6)% CAGR +25.5% NEXT GENERATION CONNECTIVITY CLOUD, EDGE & SECURITY 2022 $8Bn 2022 $109Bn 2019 $7Bn 2019 $55Bn Next Generation Connectivity Cloud, Edge & Security CAGR +0.2% CAGR +12.0% VOICE NETFOUNDRY 2022 $145Bn 2022 $224Bn ° 2019 $145Bn 2019 $159Bn TATA COMMUNICATIONS#18Key strategic enablers What helps us turn opportunities into a reality 18 Our own agility in adopting digitally transformative technologies in order to provide the same to our customers is the key to our consistent business growth. Prudent foresight Our ability to anticipate change and transform to meet and exceed the expectations of the business and the industry has paved the way for sustained growth. Customer centricity We help our customers make the most of the latest digital innovations and be agile, flexible and responsive. Skilled, engaged teams We believe it is critical for employees to continuously learn and re-educate themselves; and we provide the right platforms for employees to be able to do so. Continuous innovation Technology is constantly evolving; thus, we need to constantly challenge ourselves and innovate to invest in our future. TATA COMMUNICATIONS#19Analyst views Recognised for excellence Tata Communications Positioned as a Leader in the 2020 Gartner Magic Quadrant for Network Services, Global - 7 years in a row ABILITY TO EXECUTE CHALLENGERS LEADERS 1. Orange Business Services 2. NTT 11. Masergy 12. Colt Technology Services 3. AT&T 13. GTT 1 4. Verizon 14. Telia 5. BT 10 12 11 6. Vodafone 13 14 15 7. Tata 16 17 18 19 20 8 NICHE PLAYERS a VISIONARIES Communications 8. T-Systems 9. Telefonica 10.CenturyLink 15. Telstra 16. Global Cloud Xchange 17. Singtel 18. Sprint 19. PCCW Global 20. China Telecom Global Ability to Execute Our emphasis is on a vendor's service quality, pricing and track record. These elements are particularly important for global networks because the issues of infrastructure, language and culture are more challenging than if applicable to only one country. Completeness of Vision Visionary providers should have a clearly articulated strategy in evolving areas of enterprise networking, including networking for cloud services, SD-WAN, SDN, NFV and vCPE. The portfolio should be broad enough to satisfy the evolving requirements of most enterprises, and not just a specific vertical, industry or customer size. COMPLETENESS OF VISION As of January 2020 Source: Gartner (February 2020) 19 TATA COMMUNICATIONS#20Industry accolades Recognised for excellence APAC CIOoutlook APAC Top 10 loT Solution Companies 2019 • FROST SULLIVAN TELECOMSWORLD Asia 2019 Most Innovative IoT Project • Most Innovative Telecom Project Gartner Magic Quadrant for Network Services, Global Enterprise Telecom service provider Company of the Year - Large Enterprise Segment Unified Communications Service Provider Company of the Year Enterprise Data Service Provider Company of the Year Managed Security Service Provider Telecom Company of the Year Managed Multi Cloud Service Provider Company of the Year Cloud Interconnect Service Provider Company of the Year SDWAN Service Provider Company of the Year Video Managed Service Provider Company of the Year 20 TATA COMMUNICATIONS#21Our key stakeholders 5200 ΤΑΤΑ TATA COMMUNICATIONS#22Our shareholders Maximising long-term intrinsic value The sustained trust and confidence of our shareholders enable us to remain focused on achieving our strategic objectives and maximising long-term returns. Drive capital efficiency → Improve margin profile Shareholding pattern as of 30 September 2020 22 • Recalibrate investments • Co-create with partners ⚫ Inculcate strong discipline and governance around capital allocation and expenditure Invest for long-term growth Reshape portfolio • Invest in new services/ innovation to differentiate and accelerate growth • Improve operating efficiency and drive operating leverage Accelerate growth in high margin data segment and new services 0.9% 6.3% 17.8% Create strategic flexibility $ Generate free cash flow and deleverage balance sheet • Pursue opportunities to unlock intrinsic value Rationalise businesses with sub-par return ■TATA Sons profiles 26.1% 48.9% ■GOI ■Foreign Institutions ■Domestic Institutions ■Non-institutional TATA COMMUNICATIONS#23Our community Sustainability and CSR • • ENABLING SUSTAINABILITY AS KEY DRIVER FOR BUSINESS INNOVATION & GROWTH We are uniquely positioned to deliver the digital future now while doing good for People, the Planet and Communities Our goal is to make a positive, tangible impact on the environment and society through our actions and through our products and services for our customers COMMUNITY PEOPLE CORPORATE GOVERNANCE PLANET Planet People Zero Since last 3 years 9 lakh FATAL/MAJOR INCIDENTS MULTIPLE BEST EMPLOYER RECOGNITIONS 32.7% DIVERSITY UNITS OF ENERGY CONSERVATION GLOBALLY mix for new hires increased from 19% (FY14) 2 ~ 15 Million UNITS' Focused solutions (IoT, Mobility, MOVE, Cloud and UCC) for customers leading to cost saving, business optimisation, avoidance of travel, automation etc. Renewable energy sourced Community 2,19,166 LIVES IMPACTED 16 LONG-TERM PROJECTS 62% women and girls 62% affirmative action - communities Presence across 9 states in India International presence - Singapore 5,300+ CERTIFICATIONS COMPLETED BY EMPLOYEES with minimum 16 hours of effort 49% increase In water recycling as compared to FY20 59,194 VOLUNTEERING HOURS Contributed by 11,030 volunteers to reach 50,000 lives#24Performance overview TATA TATA COMMUNICATIONS#25Key financials (Quarterly) Revenue | EBITDA | FCF REVENUE* Q2 FY 21 3,642 759 Q1 FY 21 3,604 799 4,401 4,403 Q2 FY 20 3,399 874 4,273 EBITDA* Q2 FY 21 1,108 50 1,158 Q1 FY 21 975 67 1,042 Q2 FY 20 752 81 834 FCF* Q2 FY 21 828 45 Q1 FY 21 664 54 Q2 FY 20 379 72 380 *All figures in Rs. crore 25 670 840 • Consolidated revenues were up 3.0% YoY and flat sequentially, despite economic uncertainties. • • EBITDA grew by 38.9% YoY and 11.1% QoQ with a margin of 26.3% which expanded by 680BPs YoY on the back of strong profitable growth in data business and focus on cost efficiencies. We continued to receive Covid- related operating cost benefits in Q2. • • Profit for the quarter was INR 384 crore as compared to a profit of INR 258 crore in the previous quarter, this profit is on the back of strong EBITDA performance. Data Voice Consol Revenue Growth % QoQ YOY Data 1.1% ↑ 7.2% Voice (5.1%) (13.2%) Consol (0.0%) ↑ 3.0% EBITDA Growth % Data QoQ YOY 13.7% 47.2% Voice (25.7%) (38.6%) Consol ↑ 11.1% 38.9% FCF Growth % Data Voice Consol QoQ YOY 24.6% 118.4% (18.0%) (38.3%) ↑ 25.3% 121.2% TATA COMMUNICATIONS#26Key financials (Annual) Revenue | EBITDA | FCF REVENUE* Revenue Growth % FY 18 FY 19 FY 20 FY 20 13,692 3,376 17,068 FY 19 12,655 3,870 16,525 Consistent strong growth in Data Business despite industry challenges Data 5.5% 10.4% 8.2% Voice (21.4%) (27.1%) (12.8%) FY 18 11,460 5,311 16,772 • Data business growth is compensating for the decline in Voice business Consol (4.8%) (1.5%) ↑3.3% EBITDA* FY 20 3,026 263 3,289 FY 19 2,409 336 2,745 FY 18 2,066 347 2,412 • Voice business is declining in-line with industry and technology trends FCF* • Shift towards more profitable data business leading to EBITDA growth and margin expansion • Voice business continues to generate EBITDA Growth % FY 18 FY 19 FY 20 Data 6.2% ↑ 16.6% 25.6% Voice (16.3%) (3.1%) Consol 2.2% 13.8% (21.6%) ↑19.8% FY 20 1,742 252 1,693 FY 19 820 331 881 FY 18 882 338 898 *All figures in Rs. crore 26 healthy cash flow despite decline in revenue FCF Growth % FY 18 FY 19 FY 20 Data 42.2% (7%) 112.4% Voice (14.9%) (2.1%) (23.8%) Consol 16.2% Data Voice Consol (1.9%) ↑ 92.3% TATA COMMUNICATIONS#27Key financials (Annual) Performance Highlights | Net DEBT Net Debt USD Mn Net Debt to EBITDA USD Mn 6 1,600 1,438 1,327 3.3 3.4 3.2 3.2 3.1 1,232 4 1,150 1,151 1,216 2.8 1,193 2.6 1,170 2.3 1,200 2 800 400 0 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Jun-20 Sep-20 Cost of Debt % 0 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Jun-20 Sep-20 6.00% 3.80% 3.87% 3.86% 4.50% 3.41% 3.73% 3.12% 3.03% 2.80% 3.00% • Net debt was at USD 1,170 Mn, a decrease of USD 23 Mn over last quarter, despite dividends and employee bonus payments, aided by strong operating cashflows. 1.50% • Average cost of borrowing for Q2 was 2.80%, a decrease by 23 BPS over Q1 FY21 primarily due to decline in Average LIBOR from 0.37% in Q1 to 0.26% in Q2 FY21. 0.00% Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Jun-20 Sep-20 Note: USD-Rs.: FY15 - 61.13; FY16 - 65.44; FY17 - 67.07; FY18 - 64.47, FY19-69.9; Q1FY18 - 64.48; Q2FY18 - 64.30; Q3FY18 - 64.77; Q4FY18 - 64.35; Q1FY19-66.94; Q2 FY19 - 70.10; Q3 FY19-72.13, Q4 FY19 - 70.47; Q1 FY20 - 69.6; Q2 FY20 - 70.4; Q3 FY20- 71.24; Q4 FY20- 72.32; Q1 FY21- 72.32; Q2 FY21-73.77 FY15, FY16 are reported numbers, and include Data centre business 27 TATA COMMUNICATIONS#28Key financials (Annual) Geographical spread Gross Revenue Share by Geography - 15.0% 12.0% 11.2% 8.7% 9.0% APAC 6.0% 3.0% 0.0% FY 15 FY 20 30.0% 25.4% 25.0% 22.5% 20.0% 15.0% America 10.0% 5.0% 0.0% FY 15 FY 20 28 30.0% 24.6% 25.0% 20.0% 15.0% Europe 10.0% 5.0% 0.0% FY 15 FY 20 50.0% 41.1% 40.0% 30.6% 30.0% 13.1% India 20.0% 10.0% 0.0% FY 15 FY 20 10.0% 8.6% 8.0% 6.6% 6.0% MENA 4.0% 2.0% 0.0% FY 15 FY 20 6.0% 5.0% 4.0% 2.6% Global 2.0% 0.0% FY 15 FY 20 TATA COMMUNICATIONS#29Concluding remarks Key reflections Riding on global data growth Digital Transformation and Cloud adoption to drive the business growth Transformation driving demand for hosting, SD WAN and network virtualisation services Positioned as "Leader” in Gartner magic quadrant for network services, global for 8th consecutive year Digital push through partnerships with Microsoft, Cisco, Amazon The revamped GTM strategy has started to show positive results with an improvement both in funnel adds as well as in closed sales. Product penetration ratio * (which is the number of products sold to each customer) of Top 300 customer has improved from 5.53 in Q2 FY20 to 5.73 in Q2 FY21 FY20 Dividend of Rs. 4/- share which is 40% of face value of each share Significant land bank with the company (~740 acres) post transfer of surplus land to HPIL The Scheme for Demerger of Surplus Land has been approved by the NCLT, Mumbai on July 12, 2018. The Scheme filed by HPIL, has been approved by the Ministry of Corporate Affairs, New Delhi on 5 August 2019. The Record Date for the Scheme was September 18, 2019. HPIL has allocated the shares to all its eligible shareholders. The company shares were listed publicly, on 22nd October 2020 29 TATA COMMUNICATIONS#30Thank you www.tatacommunications.com Contact for investor queries: [email protected] ΤΑΤΑ ©2020 Tata Communications. All rights reserved. TATA COMMUNICATIONS and TATA are trademarks of Tata Sons Private Limited. TATA COMMUNICATIONS