Archive · 28 Sep 2026
Vodafone Idea Rally Diverges From Indus Towers, Kotak Questions Valuation
Vodafone Idea and Indus Towers are connected telecom companies, but their shares have moved in opposite directions.
Vodafone Idea’s share price rose 53% in six months.
Indus Towers’ share price fell 12% during the same period.
The government reduced some of Vodafone Idea’s dues and allowed more time for repayment.
This made investors feel more confident about the company.
However, Kotak says Vodafone Idea may continue losing money through FY29.
It may need higher customer payments or more government relief to improve its cash flow.
If Vodafone Idea spends more on its network and pays tower rent reliably, Indus Towers could benefit.
Kotak says the large difference between the two stocks is difficult to explain fully.
Vodafone Idea shares rose 53% over six months, while Indus Towers shares fell 12%.
Kotak linked Vodafone Idea’s rally partly to April relief that cut adjusted gross revenue dues by Rs 22,700 crore and extended repayment timelines.
Kotak expects Vodafone Idea to remain loss-making through FY29 under its current assumptions.
The brokerage said Vodafone Idea could need higher average revenue per user or additional relief on AGR and spectrum liabilities to close its cash-flow gap.
Indus Towers could benefit from higher rental income and lower delayed-payment risk if Vodafone Idea’s finances improve.
- Who
- Vodafone Idea, Indus Towers, and Kotak Institutional Equities.
- What
- Vodafone Idea’s stock rose sharply while Indus Towers’ stock declined, prompting Kotak to assess the companies’ differing prospects.
- When
- Over the six months discussed; the government’s adjusted gross revenue decision was made in April, while Kotak’s forecasts cover FY26-FY29.
- Where
- In the telecom and stock markets discussed in the report.
- Why
- Vodafone Idea benefited from reduced adjusted gross revenue dues and extended repayment terms, while Kotak questioned whether its financial improvement would be sufficient to justify the rally.
- Vodafone Idea six-month performance
- Up 53%.
- Indus Towers six-month performance
- Down 12%.
- Adjusted gross revenue relief
- The government reduced Vodafone Idea’s dues by Rs 22,700 crore and allowed repayment over a longer period.
- Profit outlook
- Kotak expects Vodafone Idea to remain loss-making through FY29 under its current assumptions.
- Vodafone Idea market capitalisation
- Approximately Rs 1.5 lakh crore, according to the report.
- Indus Towers forward valuation
- 13.3 times one-year forward P/E and 6.3 times one-year forward enterprise value to EBITDA.
- Potential Indus Towers catalyst
- Faster-than-expected capital expenditure by Vodafone Idea could create upside risks to Kotak’s estimates.