In Short:
Vodafone Idea has raised their prices. Indus Towers is waiting for Vodafone Idea to clear their overdue payments to stabilize their trade receivables. Vodafone Idea has paid Rs 1,300 crore so far. Indus Towers plans a share buyback to give cash to shareholders and preserve funds for future dividends. Bharti Airtel won’t participate in the buyback. Indus Towers reported a 43% rise in net profit.
Indus Towers Expects Trade Receivables to Stabilize
Indus Towers’ management anticipates that the company’s trade receivables will need more time to stabilize, largely dependent on Vodafone Idea’s (Vi) clearance of past dues. Trade receivables for Indus fell by 11.3% in the first quarter of the fiscal year to around Rs 5,722 crore, with improved collections from Vi.
“Stability in trade receivables can be expected in a few months, but we are in ongoing discussions with our key customer, Vi, regarding the finalization of payment plans for clearing past overdues,” said Indus CFO Vikas Poddar.
Poddar declined to disclose Vi’s current backlog of old dues to Indus following June quarter collections. Ambit Capital had estimated Vi’s past dues at around Rs 10,000 crore in February-March, but Vi has cleared only Rs 1,300 crore of old dues to Indus.
Indus announced a share buyback to distribute cash to shareholders tax-efficiently, especially after not paying dividends for two years. Bharti Airtel won’t participate, and there is no decision yet from co-promoter Vodafone Plc.
Indus reported a 43% increase in net profit to Rs 1926 crore in the June quarter, FY25, attributed to strong tower additions from Airtel’s 5G rollout and continued collections past dues recovery from Vi.
Foreign institutional investors (FIIs) and domestic financial institutions hold significant stakes in Indus Towers. Shares closed lower at Rs 432.85 on the BSE.
Indus Tower’s Share Buyback Details
The Indus board approved a buyback of 5.67 crore equity shares at Rs 465 each, totaling Rs 2,640 crore. The record date is set for August 9 to determine eligible shareholders for participation.
Vodafone Plc and Airtel Transactions
Vodafone Plc sold 18% of its stake in Indus for Rs 15,300 crore, while Airtel acquired an additional 1% stake, inching closer to majority ownership.
Ownership Breakdown
Foreign institutional investors (FIIs) and foreign portfolio investors (FPIs) collectively own 24.2% of Indus, while domestic financial institutions (FIs) and mutual funds hold 4.58% and 12.88% respectively.
