Shares of Indus Towers Ltd. surged 4.67% to Rs 349.90 on Tuesday, riding on sentiment boosted by the government’s move to convert Rs 36,950 crore worth of Vodafone Idea’s spectrum dues into equity. This move is seen as a major relief for Indus Towers, which has long been awaiting dues from its key client, Vodafone Idea.
With the equity conversion, the government’s stake in Vodafone Idea will rise from 22.6% to 48.99%, giving investors renewed confidence in the telco’s ability to meet its financial obligations. For Indus Towers, this development reduces near-term concerns over receivables and is expected to stabilize cash flows.
Brokerage reactions
Citi Research has placed Indus Towers on a 90-day positive catalyst watch, projecting a Rs 18 per share dividend payout by April. The brokerage has set a target price of Rs 470, implying a potential upside of over 41% from the current level.
Citi also forecasts a 10% core EBITDA CAGR for FY25–27E, driven by an 8% CAGR in tenancies, assuming Vodafone Idea’s network expansion plans progress as expected.
However, Macquarie maintained a neutral stance, stating it does not yet see an improvement in tenancy outlook despite the temporary relief.
Out of 24 analysts tracking Indus Towers, 13 have a ‘buy’ rating, while 6 rate it ‘hold’ and 5 suggest selling.
