Indus Towers Limited

Prachur Sah

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Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

qa

Prachur Sah

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Prachur Sah

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During the year, we undertook a double materiality assessment and a comprehensive climate risk assessment across our operations, enhancing our understanding of physical and transition risks and embedding resilience into long- term planning.

— Prachur Sah

Core revenues increased by 0.6% quarter-on-quarter, impact of one-time settlement in Q4 and network optimization by our customers weighed on the overall growth in revenue.

— Vikas Poddar

Q4 of last year also included accounting impact of towers acquired from Airtel amounting to INR 1.7 billion towards operating expenses and depreciation.

— Vikas Poddar

The sequential decline in EBITDA was partially due to higher network costs, which increased primarily due to higher maintenance activities on our aging and growing tower portfolio.

— Vikas Poddar

But over the last 3-4 years and continuously, what we are doing, we are trying to mitigate any such risk that is there, right.

— Prachur Sah

So somewhere the impact of that is getting more pronounced in the EBITDA.

— Vikas Poddar

Q

Thank you, Michelle, 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. Today, I will talk about our business performance for the quarter and year ending on March 31, 2026. FY26 was marked by strong co-location additions and continued tower additions, reflecting our strong execution capabilities, exceptional service to our customers, underpinning our competitive strength to capture a meaningful share of customers' network expansion. A gradual improvement

Vikas Poddar

Thank you, Prachur, and good afternoon, everyone. I'm pleased to present our financial results for the quarter and year ending 31st March 2026. FY26 saw strong co-location additions supported by continued customer network expansion, sustained business momentum and positive developments at our customers' end underpinned our financial performance. In terms of financial performance for Q4 FY26, total revenues were at INR 81 billion, growing by 4.8% year-on-year. Core revenues from rentals stood at INR 53.1 billion, up 5.4% year-on- year, driven by healthy co-location additions. Please note that Q

Q

Hi, thanks for the opportunity and congrats to management for dividend distribution. So we have paid around 100% of this year's free cash flow. But how should we think about the additional free cash flow we had received or generated last year which was on account of reversal of dues from VI. If I'm not mistaken, they were also supposed to be made available for distribution? And secondly, I would like to understand more about the capex going forward. Understand the green capex company is making and higher maintenance required on the aging portfolio. But if you can have some guidance over the ne

Prachur Sah

Sure. So maybe I'll answer the first part, then you can take up the capex, Vikas. See, the Board evaluated the FCF situation and the debt levels that we want to maintain and decided accordingly to distribute the FCF of FY26. And as I mentioned, the endeavor will remain to follow steady and progressive distribution going forward. So that's the thinking behind the dividend. Maybe Vikas, you can touch base on the capex. Yes. So thanks for the question, Rishabh. I think on the capex, just to give you the big picture and as we have also explained earlier, 70% of the capex that we spend is growth or

Q

Hi, thank you for the opportunity. I have two questions. First question, Vikas, I just wanted to clarify on the dividend policy. While Prachur did mention on steady and progressive distribution, is there a dividend policy or is it more ad hoc where every year, the Board will consider based on the cash flows and plan and give dividend? And if there is a dividend policy, then can you clarify what is the dividend policy?

Vikas Poddar

Yes. Sure, Sachin. So the dividend policy is, first of all, available on our website. Broadly, what it says is the Company and the Board will consider distribution of the free cash flow of the company at the year-end, subject to the working capital requirements of the company and subject to a few other conditions. So based on that, even for this year, the free cash flow of the Company, the financial results, etcetera, was presented and the Board decided to distribute the full cash generation of this year as a dividend, which is what is reflected in the INR 14. No minimum payout kind of an amou

Q

I'll take that, Vivekanand. I think, see, I guess you're referring to the growth - full year growth of 9% that we have reported. Am I right, service revenue? Vivekanand Subbaraman: So I was referring to the 4Q FY26 rental income. And I just took out some of the one-off that was there in the base period. And also the inorganic - the tower purchases that you have done, I strip that revenue out as well from both periods to arrive at 4.7%.

Vikas Poddar

Well, I think I'll just maybe explain the number that we have reported. I don't know how the 4.7% is being calculated. Maybe we can take that offline. But for the quarter, we have reported service revenue year-on-year growth of 5.3%. So as you can see, that's largely driven by the co- location growth. If you look at our co-location numbers year-on-year, you will see a growth of 5.6%. And then the other growth drivers are typically the annual escalations that we have on our sites as and when they complete the anniversary. Also bear in mind, like I explained in my narrative, there was a one-time

Q

Yes. Thanks for the opportunity. I have a few of them. First from maintenance part which you spoke, which has led to higher costs, Vikas, in your opening remarks. Just wanted to understand, was this a one-time exercise or you think because the towers have been aging now, this will be an annual phenomenon for us and hence, the cost base has got reset?

Prachur Sah

So Sanjesh, I don't think that is the case. If you look at typically, historically as well, I think Q4 is typically marked by two things. One is Q3 and Q4 are the quarters where we have clear weather. So a lot of the operational and tower maintenance activities are scheduled in this part of the quarter because the weather supports it. And secondly, in Q4 as well, what we are doing is preparing for the coming season. So I think typically, the network maintenance activities are lopsided towards Q3 and Q4. However, if you remember in Q1 call itself, what we've done is we have taken a conscious ef

Q

Vikas, Prachur, a question, once again, going to the sequential drop in the EBITDA that we have said. Okay. If I put it on a per tower basis, how we are looking at it? Is that there is a drop in EBITDA per tower on a sequential basis, roughly around INR 1,500 per tower per month. But not everything is coming from the same maintenance because, again, on a per tower basis, on a reported basis, it is just contributing 20% the increase, decrease is coming from the maintenance. It seems large part of the EBITDA per tower decrease on a sequential basis is coming from the revenue per tower or sharing

Vikas Poddar

So, Arun, I think there's more than one reason for this. So of course, like I explained, there is some one-off sitting in the revenue, which is because of the settlements that have happened in Q4. So that's impacting the top line as well as the EBITDA. Apart from that, if you see the other lines, I think even the network maintenance, as we were explaining, is growing 5.6% quarter- on-quarter which is largely driven by the maintenance activities, etcetera, that we undertook in Q4. So that has impacted. Apart from that, if you look at the other expenses, we had some one-off there also, and that

Q

Thank you for the opportunity. These are actually both follow-ups to previous questions. Firstly, just back on the question of your tower additions, which have averaged close to around 4,000 odd over the last 3 quarters. And one of your large customers has been adding 1,500, 2,000. So you said the difference could be partly because of new tower additions for other customers as well as some potential churn that happening. Would one of these 2 factors have a higher bearing than the other? Just trying to get a sense of which one could be a bigger contributor?

Prachur Sah

No, I would not put a number because it varies by quarter. At the end of the day, it's a net tenancy addition to Indus, so it does impact the revenue positively. That is the main takeaway but the split is not a fixed number, as I said. Okay. Where I was coming from is because obviously, there's a lot of this chatter about renewals for the third customer and if that could be churn for you. So the point I was trying to add is, is there a potential offsetting factor? Do these cancel each other? I mean, I know you've said that there are a lot of considerations if a tenant chooses to move out from

Q

Am I audible sir?

Prachur Sah

Yes.

Q

Just to clarify on our renewals. Since your contracts are structured tower-wise or site-wise, as you said. With respect to Reliance Jio for the tower-wise contracts that have expired, have there been any non-renewals or site exits from Jio?

Prachur Sah

No. I think there are -- for all the customers, we always have a portfolio which are not renewed, and we work with them and they get renewed yes. Even for Jio, there are certain tenancies that have expired which are still operating and some churn has happened, which we report. So I think it's not one or the other way. It's not that all the non-renewed have expired or have been churned. That's not the case. In fact, very minor percentages have been churned. Okay. And so the contracts where we have renewals happened, so that are at the same commercial terms as earlier contracts. So no incrementa

Q

To conclude, FY26 reflects consistent execution across our strategic priorities, with our core business continuing to demonstrate resilience and steady growth, supported by healthy co- location additions and sustained customer network expansion. Our plan to expand into Africa is a testament to our agile approach to growth, which will also be enabled by investments in digital and AI-led capabilities. Given our proven execution track record, focused on efficiency and long-term capital discipline, we remain confident in our ability to deliver sustainable growth and create long-term value for all

Management