Indus Towers Limited

Prachur Sah

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Prachur Sah

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Prachur Sah

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Prachur Sah

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Prachur Sah

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Prachur Sah

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Prachur Sah

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Vikas Poddar

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Vikas Poddar

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Vikas Poddar

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The decline is largely attributable to the movement in profits due to difference in collection amounts against the past dues from a major customer.

— Vikas Poddar

The sequential decline is on account of an increase in capex and timing gap in collections.

— Vikas Poddar

So to that extent, I think while the management effort continues to be to reduce diesel and improve the margins and so on, and which we are seeing from a year-on-year perspective in absolute terms, of course, I mean, it's very difficult to compare because the volume of business is also growing.

— Vikas Poddar

Now that number, if I strip out the impact of provision reversals, it's been trending lower this year.

— Vivekanand S.

So we'll keep you informed as we make the strategy more robust once we visit the ground, understand the tower structure, the tower design, and then we'll come back to you on what is going to be the way to mitigate the risk in Nigeria specifically that you had mentioned.

— Prachur Sah

But we are cognizant of the risk that you have mentioned.

— Prachur Sah

We have penetrated into these rural areas in very difficult terrains where the grid availability is a bit of a challenge, so the dependency on diesel is far bigger in those areas.

— Vikas Poddar

And if that is the case, do you see any risk that they probably try to go to a competitor or try to in-source some of it or at least try to get the rentals down?

— Balaji

And we are always looking at opportunities to expand our tenancy to mitigate any such risk from other customers.

— Prachur Sah

So I think, of course, there will be a hurdle rate that we will need to maintain for us to have a feasible business there and understanding the risk on the ground.

— Vikas Poddar

So I can't give you the future numbers, Sumangal, but what I can tell you as you have seen in Q2, we have delivered strong tower additions, despite there was a slowdown of tenancy from one major customer, which we expect to pick up in the coming quarters.

— Vikas Poddar

Q

Thank you, Rutuja, and a very warm welcome to all participants. Joining me today are my colleagues, Mr. Vikas Poddar, CFO; Mr. Tejinder Kalra, COO; and Mr. Dheeraj Agarwal, Head Investor Relations on the call. I'm pleased to present our business performance for the quarter ending on September 30, 2025. I'm happy to report that Q2 witnessed a firm uptick in tower additions compared to last quarter, driven by our ability to capture a significant share of rollouts of our customers and transition their network to our portfolio. This underscores our agile approach and trust our operators place in o

Vikas Poddar

Thank you, Prachur, and good afternoon, everyone. I'm pleased to present our financial results for the quarter ending 30th September. In the quarter gone by, we managed to deliver robust tower additions, which have aided our financial performance. So, moving to financial performance for Q2 FY26, total revenue stood at INR 81.9 billion, growing by 9.7% year-on-year. Core revenues from rental were at INR 52.4 billion, up by 11.3% year-on-year, driven by strong tower additions and acquisition of towers in March this year. On a sequential basis, our reported gross revenues and core revenues grew b

Q

I have two questions and a small clarification. Question number one, would be great to understand the growth outlook going ahead? It appears that a large amount of 4G and 5G rollout is behind. And Prachur in your opening comments, you did mention that we should see market share gains versus -- and the way I concluded is versus, let's say, new rollout coming from your incumbent operators. And a related question out there is your general thoughts on expansion in Africa. Is it because for diversification away from India or for a better growth because contribution from Africa, even after, let's sa

Prachur Sah

Okay. So let me answer those two questions. The first question is from a growth outlook point of view. So while we don't make future statements, but what we are seeing across the customers, I think the layer addition is still happening, as you saw in the results as well, the upgrade capex or the growth capex continues to be there. So from my perspective, the order book still remains strong both on new towers and tenancies and it's a mix of all the customers, not just one customer. I think for the growth outlook for the next 3 to 4 quarters, we remain confident that it is going to remain robust

Q

Yes. A couple of questions. First on the Africa. Again, touching upon it, Airtel did sell a significant amount of their towers way back in 2013 to 15. And the view at that point of time for us was that we want to keep ourselves within India. Any particular change what has happened in the industry, which has made us to revisit the factor that now we want to get back to Africa. At that point of time, we were completely not looking at it. And hence, Airtel sold their significant portion of portfolio. What has changed now?

Prachur Sah

So to be honest, I can't comment on the context that was almost 10 years ago. I think what we can say today is that we are currently at a point where Indus Towers has established itself as a leading tower company, and we are currently in a point where we can offer solutions to the customers with a very different proposition. Even our Africa market has evolved quite a bit, and there's a lot of growth opportunities that we are currently seeing. And with an anchor customer being present there, I think that gives us the ability to step into a growing market and understand about it and then take st

Q

So some bookkeeping questions. See, when I look at your energy margins now or energy under recoveries that you report, those are consistently now higher, say, at INR 100 crores to INR 125 crores on an average. Previously, they used to be, say, FY23 or say, FY22, they used to be much lower. So directionally, what has changed that has caused these under recoveries to balloon? That is question one. And the second question, I think in the opening remarks, you said something about receivables increasing due to a timing gap in collections. Could you elaborate on that? And relatedly, in the opening r

Vikas Poddar

Sure. So first of all, I think on the energy, while you're looking at the absolute, Vivekanand, this is also important to bear in mind that our business volume and the number of towers, etc., are also growing, right? So to that extent, the absolute numbers will, of course, grow. One thing which is very important to note is if you look at the H1 of last year and H1 of this year, certainly, there is an improvement. We had about 5.2% in the H1 of last year, and we have about 4.4%. So we have improved by close to a percentage. The other important thing to bear in mind is the weather disruptions an

Q

My question is regarding the Africa business foray. There have been some issues intermittently for Nigeria regarding dividend upstreaming from that geography. And all these geographies have a fairly high currency volatility. So how do you plan to hedge for this? Just clarity on that will be useful. And secondly, can you give some clarity on where the capex is going? Because if I look at the maintenance capex is not what has inched up, it is the growth capex, which has sort of inched up. And what portion is actually towards the new tenancies or towards the batteries or towards the energy initia

Prachur Sah

I'll answer the Nigeria question, and then I'll ask Vikas to talk about the capex part. See, on the Nigeria question, as I mentioned earlier, I think Pranav, it's very initial stages to give you the answer, but the good thing is, as I mentioned to you earlier, we are going with an anchor customer that has been there for quite a long time, and they have understood the market, the currency fluctuations, etc. So I think that will give us an opportunity to understand and not take undue risks, but at the same time, expand our portfolio there. So we will leverage Airtel's presence there and see how

Q

My first question is once again on the energy margins. Vikas, you explained how things have changed between first half to first half, but directionally, if we take performance in the last 10 years, there were 3 phases. If you see till kind of, say, FY19, FY20, we had a positive energy margin, something as early as 5%, 6%, 7%. Then something has changed in FY21. It became negative and it was hovering around 1.5% to 2.5% between 2021 to 24? Now suddenly, in 2025, we are at the minus 4.5%, and we are seeing some kind of a small decrease from that bottom. So what happened between these spaces? I m

Vikas Poddar

So Arun, so first of all, I think that's a very interesting question. I mean from a very long-term perspective, the way we charge the customers for energy has also changed. So from a very long- term perspective, we used to be in pass-through originally. Then later on, we shifted to fixed energy model for a few years. And then subsequently, we moved back to pass through. And today, we are in a situation where we are in a bit of a hybrid. We are in pass through with some customers, fixed energy with some customers and so on. So one is, of course, the operating model in energy itself has undergon

Q

Sure. Thank you very much.

Management

Q

Just on Africa once again. A couple of questions. Firstly, as far as unit economics are concerned, previously, in India, you've said for single-tenancy towers return on capital tends to be typically in the low to mid-single digits. What would be a comparable number in Africa ballpark?

Prachur Sah

Saurabh, it's a good question. But as I said, once we get to a point where we start discussing the MSAs with the customers, I will come back to you in terms of what returns that we are going to expect. And it is not going to be determined by what India does. It is going to be determined on what the competitive landscape is out there and what makes sense for our business to expand. So we will come back to you in terms of what return profile we could look at once we are closer to agreeing the MSAs with the customers. Okay. But directionally, do these tend to be better than what you see in India?

Q

I had just one question. So if I look at it, Jio did most of its rollouts about 10 years back, maybe 8 to 10 years back. So is it fair to say that there will be a bunched up phase of renewals for you from Jio? And if that is the case, do you see any risk that they probably try to go to a competitor or try to in-source some of it or at least try to get the rentals down? So input along those lines would be helpful?

Prachur Sah

Balaji, as I said earlier as well, at this point in time, I would not predict what you would do. But from our point of view, what we want to do is to make sure that we are providing the top quality service and have the stickiness for all our customers on our sites as we have done through 5G deployments and things like that. So as long as we are providing good service and have negotiations with them on renewal in line with what we have done for the other customers, that's what we are currently looking at. If there is any strategic decision from Jio, I think that's something that we're going to

Q

Just again, setting back on Africa again. I just wanted to get a sense that what's the kind of investment kitty that you're setting aside for the Africa foray, let's say, including both capex and the initial scale of losses that could be there in the Africa business?

Prachur Sah

Again, Shubham, as I said, I think it's a little bit too early to talk about that. We are currently in the process of understanding the market, understanding the tower design, the cost, the scale. So I think it's a little bit too early to say what would be the exact amount of investment there. And the second thing is just again on Africa. Is it right to understand that you're yet to evaluate the opportunity sizes in Africa in any of these markets? It's just an initial, you put out the intent? And are you still kind of evaluating how much financial sense does it make? How much it does not make?

Q

So I have a question again on Africa. So what is the return on capital is expected based on the homework you have done as yet? And obviously, this is just taking into account the organic expansion, inorganic will obviously depend on price and many other things. But just on the organic, what would be the return on capital as per your initial assessment? And how do you balance this versus returning capital back to shareholders in India? Like is there a particular hurdle rate below which you would say that it doesn't make sense to be in Africa and just return the capital back to Indian shareholde

Vikas Poddar

So I thought I actually answered this question earlier. Again, the return on capital in Africa will be determined also by what's there in Africa in terms of competitive landscape, what's the cost of tower that we eventually look at. And I'm only talking about the organic part here. So I think, of course, there will be a hurdle rate that we will need to maintain for us to have a feasible business there and understanding the risk on the ground. So while I cannot give you a number right now, but I think it will not determine just the factor on what we do in India, it will be more an Africa decisi

Q

Most of the questions are answered. Just on the initial comment you made, the initial phase in Africa would be more of a learning phase before which we decide to go inorganic or scale up. Is it fair to assume 2 to 3 years is the initial phase and beyond post that only a big inorganic or something major we could look at in that geography?

Prachur Sah

Sumangal, I think I would not be able to answer that question right now. As I said, if an opportunity comes earlier and it's the right thing to do, we will, for sure, consider it. So I would say let's get started with the organic way of building new towers with an anchor customer, understand the market. And if an opportunity comes with the right valuation and where we can also add value, we will consider it. So I would not put any hard deadlines as of now that we'll not do anything before 2 to 3 years, it may take 1 year, it may take 5 years. So I think it depends on what the opportunity is an

Q

To conclude, this has been another strong quarter for Indus Towers, underpinned by robust tower additions and strengthening of our market presence. A key highlight of this quarter was our announcement to foray into Africa, a significant step in expanding our geographic footprint and leveraging our proven execution model in a new high-growth market. We are making meaningful progress on our automation and AI initiatives, embedding technology deeper into our operations to strengthen efficiency, accuracy and scalability. Looking ahead, our focus remains on shaping the next phase of telecom infrast

Management