This Largecap Telecom company, which deals in the business of object of, inter-alia, setting up, operating and maintaining wireless communication towers, down upto 7 percent after Bharti Airtel & Reliance Jio partnering with Elon Musk’s Starlink.
Price Movement
In Wednesday’s trading session, Indus Towers Limited stock was down by 7.5 percent and touching a day’s low of Rs. 315.75. The stock reiterated from the day’s low and was trading at Rs. 317.85, which is 7.17 percent lower than the previous closing price of Rs. 341.50. trading at 4.23 percent lower in the day’s trade.
The stock has delivered a return of around 28.42 percent in the past year and has outperformed Nifty in the same period.
What Happened
The company’s stock is in focus after the news of Bharti Airtel and Reliance Jio agreement with SpaceX to bring Starlink’s High-Speed Internet for customers in India. However, the partnership is subjected to regulatory approvals.
Telecom companies pay 8 percent of their adjusted gross revenue (AGR) annually as a license fee, along with a separate annual spectrum fee and an upfront fee for spectrum rights. However, Starlink has proposed allocating spectrum at less than 1 percent of its total AGR as per sources.
Bharti Airtel’s Stake
Sunil Mittal’s Bharti Airtel holds a promoter stake of around 50 percent in Indus Towers as of December 2024.
Future Plans
Indus Towers plans to expand its telecom infrastructure by adding over 20,000 new tenancies in the next year, maintaining its dominant market share. They aim to reduce diesel consumption by 8 percent and increase solar-powered sites to over 30,000.
They target a 99.99 percent network uptime, ensuring seamless connectivity. Indus Towers will invest Rs. 38 crore in a 130 MW solar plant, owning 26 percent equity to improve sustainability. The company expects strong revenue growth driven by 5G rollouts and increasing tenancy ratios.
Recent Major Events
Recently, Vodafone PLC had sold around 18 percent stake in Indus Towers for its funding. The company remains confident of collecting past dues and participating in the network expansion of the customer which is mentioned by the management.
In the transcript, the management had mentioned about receiving dues from Vodafone Idea. From, the last three quarters, they are receiving but are not sure about the timeline of the remaining dues as discussion is still ongoing.
Indus Towers had announced a Buyback and Bharti Airtel increased their promoter stake from 48.95 percent to 50.005 percent in the September quarter which made Indus Towers a Bharti Airtel subsidiary after receiving CCI approval.
With this, Airtel plans to increase its stake in Indus towers by purchasing shares from Vodafone. There were plans to merge data center business Nxtra with Indus but Airtel had said it would be unlikely to do the merger.
Financial Performance
Their Q3FY25 results show revenue from operations of Rs. 7,547 crore which increased by 4.83 percent year on year, from Rs. 7,199 crore in Q3FY24 and a 1.0 percent increase from Rs. 7,465 crore in Q2FY25.
Its net profit increased by 59.93 percent year on year, from Rs. 1,540 crore in Q3FY24 to Rs. 4,003 crore in Q3FY25. Quarterly, the profits were up 80 percent from Rs. 2,224 crore.
About the company
Indus Towers Limited is a leading telecommunications infrastructure provider in India, which provides passive tower services for mobile network operators. They operate around 2,34,643 towers and 3,86,819 co-locations across all telecom circles as of Q3FY25.
The company focuses on shared infrastructure solutions, enabling efficient communication while reducing operational costs for telecom operators.
Written by Santhosh S
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