“The Indian and Indonesian tower industries are the most developed in Asia. The sector should see continued growth, as mobile operators accelerate spending on their third- and fourth-generation (3G and 4G) networks, and also sell their own tower assets,” said Nidhi Dhruv, an assistant VP and Analyst at Moody’s Investor Service in yesterday’s Indian-publication Economic Times.
In her blog Dhruv wrote, “mobile operators are looking to sell their towers and use the proceeds to fund their capex and reduce debt. Auctions for 3G/4G spectrum have attracted investments of about $44.3 billion by mobile operators since 2010 and leading telecommunications operators are beefing up their data networks to increase market share and recoup their spectrum investment.”
She believes there is no strategic benefit to owning towers versus leasing them, especially in areas where there is significant overlap in coverage. “This trend suggests that the proportion of telecommunications towers owned by independent operators in India will likely rise over the next two to three years. M&As will help the tower companies achieve scale and provide them a competitive edge by expanding their geographic footprint.”
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