Indus Towers shares slip after HSBC projects stock to fall another 11%

HSBC has initiated coverage on Indus Towers with a ‘Reduce’ call and a target price of ₹310 per share, implying around 10.7% downside from Monday’s closing, citing muted growth prospects amid slowing tower rollouts from Bharti Airtel and lingering uncertainty over Vodafone Idea’s demand outlook.

Following the note, Indus Towers’ shares were trading 1.4% lower at ₹342.35 on the NSE at 2:05 pm on Monday, after hitting an intraday low of ₹

341.05



The brokerage pointed to case studies suggesting weak pricing power in the tower leasing business, and said that even in a bull-case scenario, much of the optimism is already reflected in current valuations.

At its target price, Indus Towers would trade at EV/EBITDA multiples of 5.4x for FY26 and 5.2x for FY27.

HSBC added that potential upside risks include a major capital raise by Vodafone Idea, which could boost tenancy growth, and higher-than-expected lease rentals.

Indus Towers reported a weak set of numbers in the June quarter. Its EBITDA came in at ₹4,390.1 crore, marginally below the previous quarter’s ₹4,395.2 crore, while margins contracted to 54.5% from 56.9%. Profit after tax also slipped 2.4% sequentially to ₹1,736 crore, impacted by higher depreciation and amortisation costs as well as lower other income.

Operationally, the company added 2,468 towers in the June quarter, compared with 14,662 in the previous quarter, taking its total count to around 2.5 lakh.

Revenue rose to ₹8,057.6 crore from ₹7,727.1 crore in Q4 FY25, though tenancy additions fell sharply to 6,079 versus 18,616 in the previous quarter.