Telecom infrastructure company Indus Towers has reaffirmed that towers will remain the company’s primary business driver, even as it targets 'double-digit' returns from its foray into Electric Vehicle (EV) charging stations.
“Our primary driver of the business remains the tower business, and I think EV is at an early stage. Of course, we will maintain that distinction to ensure the tower business does not suffer. So, it’s a separate business unit and a separate team that will drive the EV business,” said Prachur Sah, Managing Director and CEO of Indus Towers, during the Q3 earnings call on January 24.
The company is setting up a dedicated unit and team to spearhead its EV charging operations.
MD and CEO Prachur Sah said the company will adopt a prudent approach in selecting contracts and deals with EV customers, ensuring alignment with the tower business model. “...It is something that will be new to the industry as well,” he added. Indus Towers is running pilots in Gurugram and Bengaluru on the technical feasibility of the project and its abilities to deploy more stations.
“We are planning to capitalize on our core strengths in managing space, power, and operations and maintenance (O&M). As we expand discussions with potential customers on a case-by-case basis, we will make decisions accordingly,” Sah said.
Vikas Poddar, CFO of Indus Towers, outlined the company’s financial aspirations for the EV business. “We are aspiring for mid to high double-digit returns. However, the business scale is currently too small to discuss returns in detail. Our priority is to develop this business, evaluate the competitive landscape, and then see where it goes. But in terms of aspirations, we expect double-digit returns,” he said.
Indus officials also said that its cash flow situation has improved significantly, and the company will review its financial position by March to decide on dividend payout. “We are fully aware that no dividend has been paid in the last two years. However, we did execute a buyback in Q2 and distributed some cash,” Poddar said.
Indus Towers had on January 23 reported a consolidated net profit of Rs 4,003 crore for the quarter that ended December 2024, marking a 159.9 per cent on year growth on the back of significant collections of dues from Vodafone Idea as well as robust tower additions.
The company saw its revenue from operations rise by 4.8 percent on year, reaching Rs 7,547 crore. Indus Tower’s Q3 EBITDA came in at Rs 6,997 crore against Rs 3,622 crore in the year-ago period, a surge of 93.2 percent.
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