Telecom infrastructure provider Indus Towers is believed to have recovered the remaining ₹500 crore owed by key client Vodafone Idea (Vi), potentially paving the way for a dividend announcement, analysts said. With rising free cash flows, the company is expected to declare dividends when it releases its Q4 FY25 results on April 30.
“We expect Vi’s outstanding dues of ₹500 crore to be cleared in Q4 FY25 and anticipate a dividend announcement alongside the quarterly results,” BofA Securities noted in a research report. Indus Towers, a subsidiary of Bharti Airtel, follows a dividend policy of distributing either board-determined excess cash or 100% of its free cash flows (FCFs).
For the first nine months of FY25, Indus generated ₹5,900 crore in FCF. Swiss brokerage UBS expects a dividend payout in the range of ₹6,000–6,100 crore, translating to a dividend per share (DPS) of over ₹20, in line with its 100% FCF payout policy.
Earlier, Indus leadership had indicated that dividend distributions were uncertain without clarity on Vi’s payment timelines. However, the scenario has improved significantly since January 2023, when Vi began settling its monthly dues and started clearing backlogged payments. In January this year, Indus confirmed it was in talks with Vi to finalize a payment plan for the remaining arrears.
Analysts believe Indus Towers stands to gain the most from Vi’s ongoing turnaround—particularly its efforts to raise ₹25,000 crore in debt following its recent upgrade to an investment-grade credit rating, a move that enables easier access to bank financing. The successful closure of this fundraise is expected to accelerate Vi’s 4G expansion and 5G rollout, especially in key urban markets.
“We believe Indus will be the biggest beneficiary of Vi’s upcoming network rollouts,” said Ambit Capital. “Vi is scaling infrastructure with macro sites and high-powered small cells in areas where Indus holds a dominant market share.”
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Ambit projects that Indus could capture as much as 70% of Vi’s new network deployments, driven by spectrum alignment between Airtel and Vi. This could push Indus’ tenancy ratio up to 1.95x by FY28, from the current 1.65x.
