Indus Towers shares rally 6% after Citi recommends buying the dip, gives Rs 500 target price

Shares of Indus Towers rallied 6.2% to a day’s high of Rs 412.45 on the BSE after global brokerage firm Citi suggested buying the stock on any dips, with a target price of Rs 500 and a maintained buy rating.

Citi stated that the amount of past dues that VI repays to Indus in Q2 FY25 should ideally rise quarter-on-quarter, given the tariff hikes. The firm also recommends using any weakness in the share price as an enhanced buying opportunity, citing an attractive dividend yield of 6-7%.

Last week, global brokerage firm BofA set a target price of Rs 450 for the stock. In its comments on the AGR decision, the firm noted that there is no direct impact on Indus, but a derivative effect may occur, with no expected impact on tenancy growth. However, a multiple de-rating is likely. There is only a low possibility of a lump-sum payment or any special dividend at this time.


On September 19, the stock fell by 14% during the intraday session following the Supreme Court's ruling in the Adjusted Gross Revenue (AGR) case. The telecom companies had requested a re-computation, but the apex court reaffirmed its decision on the AGR ruling, maintaining the full amount of the AGR demand against the telecom companies.

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For Vi, the Supreme Court confirmed the AGR demand raised by the Department of Telecom in 2019, resulting in a burden of Rs 58,000 crore. With the addition of interest, this burden has now increased to Rs 70,320 crore as of the end of FY24.

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