1. At a Glance
India’s largest telecom tower company is quietly minting profits, churning out margins that would make even SaaS startups blush. Yet, in classic PSU-style irony, it doesn’t pay dividends. Welcome to Indus Towers Ltd.
2. Introduction with Hook
Imagine a company that literally holds up India’s digital dreams—3 lakh+ towers, 99% uptime, and still no love letter (aka dividend) to shareholders.
- Market Cap: ₹1.09 lakh crore
- FY25 Net Profit: ₹9,932 Cr
- Dividend Payout: 0% (You read that right)
It’s like running a telecom dhaba on the highway of data—everyone stops, pays, eats, but the owner reinvests everything into the next roti.
3. Business Model (WTF Do They Even Do?)
Indus Towers is your invisible landlord of telecom:
- Provides passive infrastructure (towers, shelters, power supply) to Jio, Airtel & Co.
- Operates on co-location model — one tower, multiple tenants.
- Long-term contracts = stable revenue visibility
- India has 1.2 billion mobile subscribers. Each “Hello” owes rent to Indus.
It’s basically an Airtel landlord with a 10-year lease and a hidden clause: No Wi-Fi, No Dividend.
4. Financials Overview
FY25 Snapshot:
- Revenue: ₹30,123 Cr
- EBITDA: ₹20,845 Cr
- Net Profit: ₹9,932 Cr
- OPM: 69%
- EPS: ₹36.85
- ROE: 33%
- ROCE: 29%
In short: Capital-light model. Margin-heavy buffet. But payout remains as stingy as your neighborhood chaiwala during inflation.
5. Valuation
Let’s plug some fair value math here:
Method 1: PE Valuation
- EPS (FY25): ₹36.85
- Apply conservative PE of 12x: ₹442
- Aggressive PE of 15x: ₹553
Method 2: EV/EBITDA
- EBITDA: ₹20,845 Cr
- EV/EBITDA Range: 7x to 9x
- Implied EV: ₹1.45–1.88 lakh Cr
- Subtract Net Debt (~₹1,500 Cr est.)
- Equity Value: ₹1.43–1.86 lakh Cr
- Per Share: ₹538–₹700
Fair Value Range: ₹440–₹700
(Market at ₹406. Let’s just say… patience towered is patience rewarded?)
6. What’s Cooking – News, Triggers, Drama
- Major FII churn: FIIs trimmed stake from 26% to 16% and then crawled back to 26.4% by Q1 FY26.
- No dividend since FY22: Retained earnings ballooning like a suspicious IPO prospectus.
- Leadership exits: Chief Supply Chain Officer recently bailed.
- Debt repaid: ₹375 Cr NCD redeemed in June 2025.
- Capex cycle visible: ₹6,000+ Cr in asset additions in FY25.
Drama’s low-key, but the growth + governance mismatch is classic “India Inc. Telecom Style”.
7. Balance Sheet
| FY25 (₹ Cr) | Value |
|---|---|
| Equity Capital | 2,638 |
| Reserves | 29,860 |
| Borrowings | 21,156 |
| Fixed Assets | 44,380 |
| Investments | 1,486 |
| Total Assets | 63,170 |
Key Takeaways:
- D/E Ratio ~ 0.7 – Comfortable for an infra-heavy biz
- Huge reserves. Why no dividend again?
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net CF |
|---|---|---|---|---|
| FY23 | 7,905 | -1,730 | -7,133 | -958 |
| FY24 | 11,582 | -7,546 | -3,996 | 41 |
| FY25 | 19,645 | -10,910 | -8,648 | 87 |
Key Takeaways:
- Robust operating cash
- Heavy reinvestment = Zero dividend (yet again)
- Capex > 10,000 Cr in FY25. The tower expansion continues.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 29% |
| ROE | 33% |
| OPM | 69% |
| Net Profit Margin | 33% |
| Debtor Days | 58 |
Verdict:
The margin game is strong. The payout game is absent. Efficiency + profitability = textbook PSU contradiction.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | Net Profit | OPM | EPS |
|---|---|---|---|---|
| FY23 | 28,382 | 2,040 | 34% | 7.57 |
| FY24 | 28,601 | 6,036 | 51% | 22.4 |
| FY25 | 30,123 | 9,932 | 69% | 36.85 |
Key Takeaways:
- Margins rising faster than data consumption
- Profit tripled in 2 years
- EPS compounding silently while retail waits
11. Peer Comparison
| Company | P/E | ROE | OPM | M-Cap (Cr) |
|---|---|---|---|---|
| Indus Towers | 11.0 | 33.4% | 69% | 1,09,577 |
| HFCL | 68.8 | 4.3% | 11% | 11,923 |
| Suyog Telematics | 24.5 | 11.6% | 57% | 994 |
| Bondada Engineering | 43.6 | 36.7% | 11% | 4,878 |
Indus leads in scale and profitability, but also leads in “no payouts” and “investor ghosting”.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: Dropped from 68.9% to 50% in last 5 quarters
- FII Holding: Back up to 26.4%
- DII Holding: Doubled to 18.4%
- Public Holding: 5.1%
Translation: Institutions are back, public is still skeptical, and promoter has ghosted harder than a Tinder date.
13. EduInvesting Verdict™
Indus Towers is the metaphorical tower: high-margin, low-noise, and shockingly silent on shareholder love. Its valuation is modest, profitability impressive, and reinvestment story believable—but the lack of dividends and historical promoter exit still spooks.
Towering returns possible… if you can stand the wait.
Metadata
– Written by EduInvesting Analyst Team | 18 July 2025
– Tags: Indus Towers, Telecom Infra, High ROE, Dividend Mystery, Tower Business, PSU Logic
