In Short:
Bharti Airtel has received approval to increase its ownership in Indus Towers to over 50%, giving it a controlling interest after a share buyback. Indus Towers reported strong Q2 results, with a net profit of ₹2,224 crore, up 71.7% year-on-year. The company also sees ongoing demand for network expansion, expecting continued strong performance in the future.
CCI Approves Bharti Airtel’s Stake Increase
Bharti Airtel has received approval from the Competition Commission of India (CCI) to increase its shareholding in Indus Towers Limited. This decision comes in the wake of a share buyback executed by the telecom infrastructure company. Indus Towers is recognized for providing passive telecom infrastructure services, which include the deployment, ownership, and management of infrastructure for various mobile operators.
The CCI’s release states, “The Commission approves an increase in the percentage shareholding of Bharti Airtel Ltd (Bharti Airtel) in Indus Towers Ltd (Indus Towers) to 50.005 percent, pursuant to the buyback of shares by Indus Towers.”
In August, Bharti Airtel announced plans to acquire over a 50 percent stake in Indus Towers after the conclusion of an ongoing share buyback scheme valued at Rs 2,640 crore. With this increased stake, Airtel will gain controlling interest in Indus Towers, officially establishing it as a subsidiary.
Indus Towers initiated the buyback of over 5.67 crore shares (56,774,193 equity shares) at a price of Rs 465 per share on August 14, which represents around 2.107 percent of the total equity shares in the company’s paid-up share capital.
Indus Towers Q2 Performance
On Tuesday, Indus Towers reported its consolidated financial results for the second quarter ending September 30, 2024. The company achieved a net profit of Rs 2,224 crore for this quarter, marking a remarkable 71.7 percent increase year-on-year.
Consolidated revenue reached Rs 7,465 crore, reflecting a 4.7 percent year-on-year increase. Furthermore, consolidated EBITDA soared to Rs 4,907 crore, representing a 42 percent year-on-year increase and an EBITDA margin of 65.7 percent. Notably, Indus Towers‘ Q2 FY25 results included a write-back of Rs 1,077 crore in provisions for doubtful receivables, bolstered by collections from previous overdue amounts.
The company concluded the quarter with a total tower base of 229,658 and a closing sharing factor of 1.65.
Operational Outlook and Future Network Expansion
Indus Towers stated, “Our operational performance reflects sustained demand for network expansion and our endeavor towards securing a larger share of our customers’ rollouts. This ongoing demand continues to enhance our financial performance, supported by steady collections against past dues from a major customer.”
Additionally, Indus Towers expressed optimism for future performance, anticipating continued growth in line with the network expansion plans of its customers in the near to medium term.
