Indus Towers expects network rollout from Vodafone Idea and the 5G traffic increase on the tower sites to drive its growth in the near-to-medium term.
This assumes significance as Vodafone Idea, which recently inked a Rs 30,000-crore deal with equipment vendors, is expected to start expanding its 4G network this quarter onwards. This will lead to tower sites addition and incremental tenancies for Indus Towers.
“We are anticipating incremental tenancies to flow through from one of our major customers (Vodafone Idea), along with others in the near term, which we believe will add to our growth,” Prachur Sah, managing director of Indus Towers, said at the July-September quarter earnings call with analysts on Wednesday.
Sah said the increase in 5G data consumption and shift from 2G to 4G services, is also leading to growth as this increases the tower loading revenue for the company.
Indus Towers has been receiving nearly 100% monthly payments from Vodafone Idea since January 2023. However, it remains engaged with Vodafone Idea to get the past dues cleared.
“From our perspective, the timeline has to be as quick as possible and we are working with the customer (Vodafone Idea) to make sure we get the overdues,” Sah said.
So far, Vodafone Idea has paid Rs 2,328 crore towards outstanding dues, including Rs 1,028 crore in the July-September quarter. Aided by collections against past overdue, Indus Towers had a write back of Rs 1,077 crore in provision for doubtful receivables in the July-September quarter.
As of September-end, Indus Towers has a provision for doubtful receivables of Rs 3,548 crore related to Vodafone Idea, down from Rs 5,386 crore in March.
During the quarter, Indus Towers added 3,748 macro towers and 4,308 co-locations, taking its base to 229,658 towers and 379,236 co-locations, respectively. Its tenancy ratio was at 1.65.
“As our major customers continue to roll out, I believe this growth will continue. Over the last 1-1.5 years, because of a strong tower rollout, we will remain the prime candidate to make sure that we capture this growth,” Sah said.
During the quarter, Indus Towers also completed the buyback of 56.8 million shares at Rs 465 apiece. The shareholding of Bharti Airtel in the company has now increased to over 50%.
