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Yes Securities Report
Overall, Indus Towers Ltd. reported subdued performance for the quarter and except for one off provisions, the financial performance was broadly inline. The one off provision of Rs 12.3 billion impacted the Ebitda margin for the quarter.
We expect return of stability in telecom sector on account of reforms announced by the Union government to drive tower/ colocation addition led by demand for increase in 4G coverage/capacity.
Also, the implementation of 5G would drive the addition of small cells and would unlock opportunities for it. However, it needs to be seen how the 5G related opportunities shape up in coming quarters.
The dividend yield of ~7%‐8% offers protection from downside. For renegotiation on rental on colocations, Indus Tower has completed the negotiation with its customers.
We estimate consolidated revenue compound annual growth rate of 2.4% over FY22‐ FY24E, with average Ebit margin of 31.3%.
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