Airtel Purchasing Additional Stake in Indus Towers Is Good for Long-Term

Bharti Airtel purchasing an additional stake in Indus Towers is a good thing for the company in the long term. Indus Towers is driving the infrastructure growth in the telecom sector, and the demand for its services will grow further as the 5G market matures in the country. Bharti Airtel recently announced that it would be purchasing an additional 4.7% stake in Indus Towers at a discounted rate from the Vodafone Group UK. The telco had placed a condition that Vodafone would use the proceeds from the equity sale for clearing dues of Vodafone Idea (Vi) with Indus Towers and infuse the rest of the amount as fresh equity into Vi.

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Airtel Already Owns Plenty of Indus Towers

With the move, Airtel is helping itself as well as Vodafone Idea. The telco will get Vi’s dues cleared with Indus Towers, which will be good for the tower company and ultimately good for Airtel as it owns a major chunk of the company.

Further, infusing fresh capital in Vodafone Idea (Vi) would keep the balance of the sector in check. Even Airtel has promoted the idea of 3 private telecom operator market in India. With the additional stake, Airtel would become an even larger owner of the company. Airtel already had close to 42% of Indus Towers. This additional 4.7% would make Airtel’s presence as a promoter even stronger in Indus Towers.

The more money Indus Towers makes with infrastructure development in India, the more money Airtel will also make as an owner.