According to a recent report by Motilal Oswal Institutional Equities, despite the 5G opportunities and growth momentum cited by Indus Towers’ management, the long-term business concerns of Vodafone Idea (Vi) remain an overhang for the towerco.
In its recent note on Indus Towers’ financial results, Motilal Oswal said that the management continues to reiterate that 5G and fibre opportunities would continue to drive growth in the future as dependency on strong telecom infrastructure remains. Tenancy additions have also improved in the past three quarters which signifies demand for new towers
Further, the report added that however, Vi remains a large client for Indus Towers and the tower sharing business has limited business case for single tenancy operations. As Vi is facing a severe liquidity risk due to its huge cash obligations, its long-term business concerns still remain an overhang for Indus Towers.
Meanwhile, Motilal Oswal has maintained a neutral call on Indus Towers.
