Motilal Oswal's research report on Indus Towers
Indus Towers’ (Indus) 3QFY25 reported financials were ahead of our estimates, largely due to the higher-than-estimated reversal of prior-period bad debt provisions (INR30.2b vs. our estimate of INR12.5b). Operationally, the core performance was in line, with Indus’ recurring EBITDA rising 4% QoQ to INR39.3b (+8% YoY) as tower/tenancy additions picked up, while ARPT remained stable QoQ. Given significant prior-period collections and moderation in capex, Indus’ 9M FCF was robust at ~INR60b (of which INR27.5b was used for buyback)
Outlook
Our FY25-27 estimates are broadly unchanged. We value Indus on a DCF-based TP of INR400 (implies ~8x FY27E EBITDA). We maintain our Neutral rating on the stock.
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