Should you buy, sell or hold Indus Towers after 4-day gains?

Indus Towers shares in Friday's trade continued their uptrend for the fourth session in a row even as the markets turned wary of the RBI's MPC decision. At the time of writing this copy, shares of the telecom equipment major traded with gains of 0.19 per cent or Rs 0.7 per share at Rs 364.2 per share.

In the last 4 trading sessions, the stock has climbed as much as 8 per cent and currently is trading with as much as 106 per cent gains from its 52-week low price.

On Thursday, in a Rs 2,800 crore block deal Vodafone PLC exited the company completely and throught the proceeds the company will reduce the debt burden of Vodafone Idea.

Additionally, after Vodafone's stake sale, as many as 15 fund houses bought stake in the company. Morgan Stanley Asia bought 2.1 crore equity shares, while Kotak Mahindra Fund bought 1.45 crore shares.

Furthermore, BofA Securities also bought stake in the midcap telecommunications stake -adding 1.23 crore equity shares into its fund.

Should you buy, hold or sell Indus Towers?

Global brokerage JP Morgan has continued with its overweight rating and a target of Rs 520- implying potential gains of over 43 per cent. The brokerage expects Vodafone to repay its past dues entirely by Q4FY25 or in worst case early FY26. This should drive increased possibility of dividend announcement for FY25, added the brokerage.

Also, for the teelcom infra company, the brokerage anticipates higher tower rollouts in the second half than in the first half of the current calendar year.

Voda ldea is currently rolling out in urban areas and Indus has tower footprint available to add IDEA as second tenant, keeping fresh capex low, pointed out the brokerage.

Tower rollouts in FY25 have been skewed towards urban to drive more densification as compared to rural last year. 5G rural rollout is still some time away as 5G use cases haven't picked up, it adds.

Average Revenue Per Tower is not seeing an increase due to mix shift towards lower rental low-cost macro towers and renewal discounts. 7-8 per cent tower renewals are coming every year with bulk expected in FY27, forecasts the brokerage.

Furthermore, Indus Towers has no plans to repay debt as it is comfortable with current leverage and hence excess cash will be returned to shareholder, it added.