- 31 Jul 2024
- ICICI Securities
INDUS TOWERS: PROVISION WRITEBACK AIDS MARGINS AND BOTTOMLINE; VI DUES RECOVERY KEY AHEAD
INDUSTOWER - 389 Change: -11.35 (-2.83 %)News: Indus Towers net tenancy was up by 6340 during the quarter with average sharing factor of 1.67x (vs. 1.69x in Q4) with addition largely driven by Airtel rural expansion. The revenue was up 2.6% QoQ and 4.3% YoY at ₹ 7,383 crore, with rental revenues at ₹ 4637 crore, up 1.2% QoQ and 4.4% YoY. Ebitda margin was 61.6% (up 500 bps QoQ) with EBITDA at ₹ 4545 crore driven by writeback of provision of ₹ 760 crore as it collected past dues. Net profit was up 3.8% QoQ at 1926 crore aided by higher EBITDA.
Views: We note that tenancy addition and margins reported are healthy. Nonetheless, key will dues from Vi which has remained delayed. Going ahead, it will be important to monitor Vi approach to overdue payments of ₹ 4624 crore. The board approved proposal to buyback up to 5.7 crore equity shares for an aggregate amount of ₹ 2,640 crore at ₹ 465 per share.
Impact: Neutral