Why will Indus Towers shares be in focus tomorrow after GoI's stake raise in Vodafone Idea?

Indus Towers shares have risen for five consecutive trading sessions and are expected to gain attention on April 22, as the Government of India's increased stake in Vodafone Idea may help the company recover ₹500 crore in dues and declare dividends.

Shares of Indus Towers have risen for the last five trading sessions, and are likely to be in the limelight again on Tuesday, April 22, amid hopes that a stake increase by the Government of India (GoI) in beleaguered telecom player Vodafone Idea will likely help the company recover ₹ 500 crore in dues and also declare a dividend to reward its shareholders. Indus Tower share price settled 3.07% higher on Monday, April 21, at ₹ 410 apiece after Vodafone Idea said today that GoI has increased its stake from 22.

60% to 48.99% by converting a portion of the company’s spectrum payment dues into equity shares valued at ₹ 36,950 crore. With today's rise, Indus Tower stock has risen 10% in the past five trading sessions.

What does Vi stake purchase by GoI mean for Indus Towers? Analysts believe the latest move of stake increase by the government will provide cashflow to Vodafone Idea and help clear past dues, which bodes well for Indus Towers. “GoI’s recent move provides cashflow support to Vi and could also aid in the completion of Vi’s long-pending debt raise. We believe more comfort on Vi’s survival and improved visibility on the completion of Vi’s capex plans could be materially near-term positive for Indus Towers,” said Motilal Oswal Financial Services (MOSL) in a report earlier this month.

More to come...

.