Source: Zee business
Indus Towers Limited is going to have a very important board meeting today, that is, April 30, 2025, looking into matters geared towards benefiting the shareholders of the company. They include: Share Buyback, Bonus Issue, and possibly Dividend Payout. Such measures indicate the intention of the company to deliver value to shareholders and increase confidence in the market else per any acceptable mode or combination therein.
First-Ever Bonus Issue Likely
Historical milestone – In case the approval is granted, then this would be the first bonus issue of Indus Towers after becoming a listed company on stock market. This act is likely to represent the financial strength of the company and its concern for long-term investors.
Dividend Anticipation Increases
Client Payments Resumed: Analysts expect dividend payments to the tune of ₹15 to ₹20 per share after payments against outstanding dues by Vodafone Idea, one of Indus Towers’ major clients.
Previous Dividend Payment Record: The company has not distributed a dividend since 2022 primarily on account of cash flow being impacted by delayed payments. Hence this payout is rendered very meaningful.
Strong Cash Flow Reinforces Speculation
Performance for Indus Towers in December 2024 will have an impressive cash flow of ₹2,700 crore in Q4 2024. Should this cash flow remain at these levels for the March 2025 quarter, analysts at Citi expect free cash flow to be at ₹20 per share.
Arguable Total Dividend Payout: This free cash flow could be fully distributed as dividend to shareholders, thus even intensifying the optimism of investors.
Prior Repurchase and Equity Movement Impact on Repurchase in 2024: The company managed to conduct its first share buy-back in the year 2024 since 2016, but stock is still trading way less than the buy-back price of ₹465. On Tuesday, the share price closed lower at ₹403.25 apiece, down 1.19%, and still below its 52-week high of ₹460.
Investor Sentiment:
Although this appears to be loss-making, speculation remains rampant over-the-top that the company might even come up with new measures to enhance this value, including a potential dividend and bonus issue.
Compliance and Trading Window Closure
Regulatory Measures:
The trading window for the shares of Indus Towers remains closed for all Designated Persons up to and including May 2, 2025. This is to ensure that compliance with market regulations and insider trading rules is maintained during price-sensitive periods prior to the board meeting.
Official Statement and Strategic Intent
Company Filing: As per an exchange filing dated April 27, Indus Towers stated, “Meeting scheduled on Wednesday, April 30, 2025, shall, inter-alia, consider viable options and strategies for enhancing shareholder returns including through buy back, bonus by way of shares and/or debentures or dividend or any other permissible mode or instrument or any combination thereof,”
Disclaimer
This article is for educational purposes only. The views and projections mentioned herein are purely based on analyses by individual experts. Investors are solely advised to refer to certified financial professionals for any investment decisions.
