Indus Towers , India's leading telecom tower infrastructure provider, has reported robust financial results for the first quarter, demonstrating strong growth and operational performance despite challenging weather conditions.

Key Financial Highlights

• Gross revenues increased by 9.1% year-on-year to ₹80.60 billion
• Core rental revenue grew by 10.1% year-on-year to ₹51.10 billion
• EBITDA declined 3.4% year-on-year to ₹43.90 billion
• EBITDA margin stood at 54.5%, down 7.1 percentage points year-on-year

Operational Performance

Indus Towers continued its strong momentum in tower and co-location additions during the quarter:

• Added 2,468 macro towers, bringing the total to 251,800
• Added 5,777 co-locations, increasing the total to 411,200
• Maintained a portfolio tenancy ratio of 1.63
• Expanded solar site count to over 32,000, with 2,250 sites added during the quarter

Network Resilience and Uptime

Despite facing challenging weather conditions, including an early onset of monsoon and increased weather-related disruptions, Indus Towers managed to maintain a high network uptime of 99.96%. This achievement underscores the company's operational excellence and commitment to service quality.

Strategic Initiatives and ESG Focus

The company continued to make progress on its strategic priorities:

• Expanded IBS (In-Building Solutions) deployments, achieving the highest quarterly additions in its history
• Advanced its decarbonization roadmap to achieve near-term targets approved by SBTi
• Launched 'Sankalp', a safety campaign to improve technician safety when working at heights
• Improved gender diversity, with women representation in the workforce increasing to 15.7% from 11.2% in the same period last year

Dividend Policy Update

In a significant move, the Board of Directors has decided to conserve cash in the short term and suspend dividend distribution. This decision will be reassessed by the end of the financial year, taking into account factors such as the evolving industry landscape, customer stability, elevated capex requirements, and potential inorganic growth opportunities.

Management Commentary

Prachur Sah, Managing Director and CEO of Indus Towers, commented on the results: "We are pleased to have started the financial year on a strong note, continuing the momentum built previously. Our operational excellence and customer-centric approach have enabled us to maintain a majority market share in our customers' rollouts, resulting in healthy tower and co-location additions from all our customers."

Vikas Poddar, CFO, added: "It has been a good start to the year, underpinned by healthy co-location additions and notable financial performance. We continue to sharpen our focus on cost efficiency and technology-led transformation, including automation and AI."

Future Outlook

With structural growth drivers firmly in place, including rising data consumption and increasing 5G adoption, Indus Towers remains confident in its ability to deliver sustainable value in an evolving market. The company expects robust tower rollout momentum to continue based on strong order book visibility for the next 4-6 quarters.

Indus Towers' Q1 results demonstrate the company's resilience and ability to deliver growth despite challenges, positioning it well to capitalize on the ongoing digital transformation in India's telecom sector.

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.