This article first appeared on GuruFocus .
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Total Revenue:INR 81.5 billion, a 7.9% year-on-year increase.
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Core Revenue from Rental:INR 52.7 billion, up 9.5% year-on-year.
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Reported EBITDA:INR 45.1 billion, a decline of 35.6% year-on-year.
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EBITDA Margin:55.3%, down 37.4 percentage points year-on-year.
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Profit After Tax:INR 17.8 billion, a decrease of 55.6% year-on-year.
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Free Cash Flow:INR 7.9 billion, compared to INR 3 billion in the previous quarter.
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Trade Receivables Increase:INR 4.5 billion during the quarter.
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Macro Towers Added:3,548 towers during the quarter.
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Colocations Added:6,105 colocations during the quarter.
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Tenancy Ratio:Stable at 1.62.
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Lean Towers:Total of 14,000 lean towers.
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Sites with Solar Access:40,000 sites, with 4,000 added during the quarter.
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Diesel Consumption Reduction:4% year-on-year decrease in Q3 FY26.
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Network Uptime:99.976% in Q3 FY26.
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Release Date: February 03, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Indus Towers Ltd ( BOM:534816 ) reported a 7.9% year-on-year increase in total revenues, reaching INR81.5 billion, driven by healthy colocation additions.
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The company added 3,548 macro towers and 6,105 colocations during the quarter, reflecting a year-on-year growth of 10.6% and 9% in tower and co-location base, respectively.
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Indus Towers Ltd ( BOM:534816 ) has made significant progress in reducing diesel consumption by 4% year-on-year, with 40,000 sites now equipped with solar access.
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The company is actively involved in digital transformation, equipping sites with IoT connectivity and smart meters, which enhances operational efficiency and asset performance.
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Indus Towers Ltd ( BOM:534816 ) is expanding its footprint in Africa with a focus on organic growth, establishing a holding structure and progressing on key work streams like licensing and regulatory approvals.
Negative Points
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Reported EBITDA declined by 35.6% year-on-year and 2.3% quarter-on-quarter to INR45.1 billion, with EBITDA margin lower by 37.4 percentage points year-on-year.
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Profit after tax decreased by 55.6% year-on-year and 3.4% quarter-on-quarter to INR17.8 billion, impacted by negligible provision write-backs.
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Energy margins remained negative, though improved from previous quarters, indicating ongoing challenges in achieving cost neutrality.
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The company faces uncertainty regarding future CapEx intensity and cash return plans, with potential easing expected only in a 2-3 year timeframe.
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Indus Towers Ltd ( BOM:534816 ) is cautious about providing specific guidance on future tenancy growth and revenue trajectory, reflecting market uncertainties.
Q & A Highlights
Q: How long will the current revenue growth sustain, and what is the outlook for future revenue trajectory? A: Prachur Sah, CEO, explained that the current growth in tower and tenancy is driven by customer network expansion and Indus's operational value. While FY24 was an exceptional year, the order book remains strong, and growth is expected to continue. Vikas Poddar, CFO, added that revenue growth is driven by various factors, including tenancy additions and 5G equipment loading, which will continue even if tower rollouts slow down.
Q: What is the outlook for CapEx intensity in the coming years, and how does it relate to cash returns and balance sheet optimization? A: Prachur Sah, CEO, stated that CapEx is driven by customer orders for growth initiatives like tower additions and solar deployments. While growth remains robust, CapEx will be maintained until growth moderates. Vikas Poddar, CFO, added that CapEx includes site upgrades and maintenance, and while it may ease in the long term, current order books suggest continued investment. Cash returns and balance sheet optimization will be considered in light of growth opportunities.
Q: Are the current EBITDA margins sustainable, and what are the key drivers for maintaining or improving them? A: Vikas Poddar, CFO, noted that the improvement in EBITDA margins is partly due to seasonality and digital interventions driving operational efficiency. While margins have improved, a longer-term view should be taken as quarterly results can have seasonal variations. The focus remains on driving efficiency and productivity to sustain margins.
Q: Can you provide clarity on the upcoming renewal of Jio sites and any discussions with the company? A: Vikas Poddar, CFO, stated that customer-specific discussions are confidential and declined to provide details on Jio site renewals.
Q: What is the status of dividend distribution, and how will recent tax changes impact this? A: Prachur Sah, CEO, mentioned that the Board will consider distribution options at the end of Q4, taking into account recent tax changes. The Board is committed to shareholder distribution, and all options will be evaluated.
Q: How is the Africa expansion being funded, and what is the strategy for growth in that region? A: Prachur Sah, CEO, explained that the focus in Africa is on organic growth through greenfield expansion. The strategy involves leveraging learnings from India to create cost-efficient and operationally efficient towers. Vikas Poddar, CFO, added that initial funding will likely be debt-funded, with details still being worked out.
Q: What is the current status of outstanding dues from Vodafone Idea? A: Prachur Sah, CEO, confirmed that there are no outstanding dues from Vodafone Idea, and business is proceeding as usual based on the credit period.
Q: How does Indus Towers plan to address energy losses and move towards neutral energy margins? A: Prachur Sah, CEO, highlighted ongoing efforts to reduce diesel consumption and improve energy efficiency through solar and battery deployments. While a specific timeline was not provided, the focus is on continuous improvement to achieve ideal cost structures.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
