Indus Towers Limited , India's leading provider of passive telecom infrastructure, has reported its financial results for the first quarter, showcasing a mixed performance amid a challenging business environment.

Revenue Growth and Operational Metrics

The company reported a 9.1% year-on-year increase in consolidated revenue, reaching Rs 8,058.00 crore for Q1. This growth was primarily driven by an expansion in the company's tower portfolio and co-locations. As of the quarter-end, Indus Towers operated 251,773 towers with 411,212 co-locations, representing a significant increase from 225,910 towers and 374,928 co-locations in the same quarter last year.

The closing sharing factor remained stable at 1.63, indicating consistent demand for the company's infrastructure sharing services. However, the sharing revenue per tower per month decreased by 2.2% year-on-year to Rs 67,036.00, reflecting some pricing pressure in the market.

Profitability and Margins

Despite the revenue growth, Indus Towers faced challenges in maintaining its profitability. The consolidated EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) declined by 3.4% year-on-year to Rs 4,390.00 crore. Consequently, the EBITDA margin contracted to 54.5% from 61.6% in the same quarter of the previous year.

The company's net profit after tax decreased by 9.8% year-on-year to Rs 1,737.00 crore. This decline can be attributed to higher depreciation and amortization expenses, which increased by 9.2% year-on-year to Rs 17,043.00 million, reflecting the company's continued investments in its infrastructure.

Financial Position and Returns

Indus Towers maintained a strong financial position, with the net debt (including lease liabilities) decreasing to Rs 167,360.00 million, compared to Rs 191,777.00 million a year ago. The company's return on equity (pre-tax) improved to 40.8% from 34.7% year-on-year, while the return on capital employed increased to 28.1% from 20.9%.

Operational Highlights and Strategic Initiatives

During the quarter, Indus Towers added 2,468 macro towers and 5,777 co-locations on a net basis. The company also reported 13,935 lean co-locations, which are primarily deployed for network densification.

Prachur Sah, Managing Director and CEO of Indus Towers, commented on the results: "We are pleased to have begun the year on an encouraging note, underpinned by healthy co-location additions, including substantial deployment on our existing towers. Our inherent strengths as a leading passive infrastructure player continue to help us achieve a meaningful share of our customers' rollouts."

The company is focusing on future-proofing its operations by investing in AI and digital solutions. As of the quarter-end, Indus Towers operated approximately 32,173 solar-powered sites across its network, demonstrating its commitment to sustainable practices and reducing operational costs.

Market Reaction and Outlook

The market reacted positively to Indus Towers' results, with the company's stock price closing at Rs 421.10 on the last day of the quarter, representing a significant increase from the previous year. The company's market capitalization stood at Rs 1,110.93 billion.

While Indus Towers faces challenges in maintaining profitability margins, its continued focus on expanding its tower portfolio, investing in new technologies, and improving operational efficiencies positions it well to capitalize on the growing demand for telecom infrastructure in India. The company's strong market position and strategic initiatives are expected to drive long-term growth as the telecom sector continues to evolve.

As the Indian telecom industry progresses towards wider 5G adoption and increased data consumption, Indus Towers remains well-positioned to benefit from these trends, leveraging its extensive nationwide presence and strong relationships with leading telecom operators.

Indus Towers Limited , India's leading provider of passive telecom infrastructure, announced its financial results for the first quarter ended June 30, 2025 (Q1 FY26), reporting a mixed performance with strong revenue growth but declining profits.

Revenue Growth and Operational Highlights

The company reported a consolidated revenue of Rs 80,576.00 million for Q1 FY26, marking a 9.1% year-on-year increase from Rs 73,830.00 million in Q1 FY25. This growth was primarily driven by healthy co-location additions and substantial deployment on existing towers.

Indus Towers expanded its infrastructure significantly, with the total number of towers reaching 251,773 as of June 30, 2025, up from 225,910 a year ago. The number of co-locations increased to 411,212, compared to 374,928 in the same quarter last year. However, the average sharing factor slightly decreased to 1.63 from 1.67 year-on-year.

Profitability Under Pressure

Despite the robust top-line growth, Indus Towers faced challenges on the profitability front:

• EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) declined by 3.4% year-on-year to Rs 43,901.00 million.
• EBITDA margin contracted to 54.5% from 61.6% in Q1 FY25.
• Net profit after tax decreased by 9.8% year-on-year to Rs 17,368.00 million.

The decline in profitability can be attributed to rising operational costs, particularly in power and fuel expenses, which increased by 5.8% year-on-year to Rs 30,687.00 million.

Financial Position and Cash Flow

Indus Towers maintained a strong balance sheet:

• The company reported a net cash position of Rs 24,612.00 million (excluding lease liabilities) as of June 30, 2025.
• Operating free cash flow for the quarter stood at Rs 14,436.00 million, down 17.8% year-on-year.
• Return on Capital Employed (ROCE) improved to 28.1% from 20.9% in the previous year.

Management Commentary

Prachur Sah, Managing Director and CEO of Indus Towers, commented on the results: "We are pleased to have begun the year on an encouraging note, underpinned by healthy co-location additions, including substantial deployment on our existing towers. Our inherent strengths as a leading passive infrastructure player continue to help us achieve a meaningful share of our customers' rollouts."

He added, "Given the transformative potential of new age technologies, we continue to make investments in AI and digital solutions, aimed at future-proofing our operations. We believe that our scale, agility, and tech-forward approach position us favourably to capitalize on emerging opportunities amidst the backdrop of a rapidly evolving industry landscape."

Future Outlook and Strategic Focus

Indus Towers remains focused on capitalizing on the growing demand for telecom infrastructure, particularly with the ongoing 5G rollout in India. The company is investing in AI and digital solutions to enhance its operational efficiency and meet the evolving needs of its customers.

The Board of Directors, considering factors such as the evolving industry landscape, customer stability, elevated capital expenditure, and potential inorganic growth opportunities, has decided to conserve cash in the short term. This decision will be reassessed by the end of the financial year, demonstrating a prudent approach to capital allocation in a dynamic market environment.

As India's telecom sector continues to evolve, Indus Towers' extensive presence across all 22 telecom circles and its focus on technological advancements position it well to benefit from the country's digital transformation journey.

Financial Summary

Indus Towers' Q1 FY26 results reflect the company's ability to grow its top line in a competitive market while facing margin pressures. The company's strategic investments and focus on operational efficiency will be crucial in navigating the evolving telecom landscape and returning to profit growth in the coming quarters.