Indus Towers collected an extra Rs 360 crore from Vodafone Idea (Vi) towards old dues including interest, but its trade receivables increased by Rs 430 crore sequentially in the FY24 March quarter, indicating a Rs 60 crore shortfall in collections from its key client, analysts said.
They added that despite part-clearance of old dues, Indus’ trade receivables have risen sequentially to Rs 6,450 crore in Q4FY24 as the actual collection of Vi’s past outstandings happened in April 2024.
“The Rs 430 crore increase in Indus’ trade receivables is due to a timing difference and the amount was subsequently collected in April,” Kotak Institutional Equities said in a research note.
It added that while Indus reversed Rs 370 crore of prior period bad debt provisions, the increased receivables indicated a Rs 0.6 billion (Rs 60 crore) shortfall in collections.
Indus’ allowance for doubtful receivables shrunk to Rs 5,400 crore in the March quarter from Rs 5,700 crore in the quarter to December, FY24.
Indus shares were marginally down (0.32%) at Rs 353.65 in early afternoon trade on the BSE Thursday.
Prior to the latest Rs 360 crore payment, Vi’s past dues to Indus Towers were estimated at around Rs 10,000 crore, as per Ambit Capital.
“Elevated capex of Rs 8,400 crore in FY24 resulted in Indus' FCF being low at just Re 1 /share in FY24. Despite assuming higher growth and partial recovery of outstanding dues from Vi over FY25/26, elevated capex will keep FCF low at Re 1 / share in FY25, reducing the chances of dividend