Neutral Indus Towers; target of Rs 410: Motilal Oswal
Moneycontrol • 3 days ago
Key Investment Pillars
- Strong order book: Indus Towers' order book remains strong, driven by continued network expansion and increased rollout activity by major customers, providing visibility for the coming quarters.
- Tenancy additions: Net tenancy additions surged in 2QFY27, with 7,903 additions, higher than the estimate of 6,000, driven by acceleration in Vi's rollouts.
- Africa expansion: Tower deployments commenced in Uganda and Zambia, with Nigeria expected to start in 3QFY27, as part of the company's long-term growth strategy.
- Energy cost management: Despite higher diesel prices, power and fuel costs were contained due to lower diesel consumption and sustainable energy cost reductions from solarization and digitalization initiatives.
Thesis Validation Checklist
- Monitor tenancy additions: Watch for continued strong tenancy additions, particularly from Vi, to validate the investment thesis.
- RJio's tenancy renewals: Track RJio's tenancy renewals to assess the risk of tenancy exits.
- Vi's fund raise: Monitor Vi's fund raise progress, as delays could impact tenancy additions.
- Africa expansion progress: Follow the progress of Indus Towers' expansion in Africa, a key long-term growth driver.