GTL Infrastructure is deeply involved in the telecom infrastructure sector in India. GTL Infra builds mobile towers that keep us all connected.
GTL Infrastructure’s last 2-3 years have been a rollercoaster of growth and transformation. The company’s revenue has seen a steady uptick since 2020, with sluggish increase year after year.
You might think that the company’s strategic moves and the increasing demand for its services can be a signal of future growth but let’s see what experts think about it.
GTL Infra Share Price Target by 2030
GTL Infrastructure is currently trading around Rs 0.75, almost 48% lower than last year’s price of Rs 1.45 per share.
The reason for this share price fall is that GTL Infra is grappling with a significant problem – too much debt (around Rs 4,500 crores). Imagine you are owing a lot of money, but struggling to find a way to pay it back.
#1. GTL Infra Share Price Target for 2025
According to expert opinions, GTL Infra stock could experience growth of around 20-25% and you can expect the price to trade around Rs 1 per share by 2025 if it manages to increase its profitability and reduce its debt.
As per GTL Infra’s Annual report 2022, the firm had 14,000 plus towers that were unutilized, which is a major concern for the company’s revenue growth and profitability. The underutilization of resources may lead to high OPEX (operational expenditure).
#2. GTL Infra Share Price Target by 2030
Looking further into the future, by 2030, GTL Infrastructure could be on the verge of something greater. With the continued expansion of the telecom sector and the company’s strategic initiatives, some analysts believe that the share price might witness a remarkable surge of 40-50%.
According to a joint report by Google & 2 other firms, India’s telecom sector may grow 6-fold by 2030. This massive growth in the telecom sector is expected to help GTL Infra increase its business and become a profit-making business. Analysts have forecasted that GTL Infra’s share price can reach in the range of Rs 2 to Rs 2.50 by 2030.
Fundamental Analysis of GTL Infrastructure
Revenue growth: Over the past 3 years, GTL Infra’s revenue growth is not so impressive as the company’s sales increased with a compounded annual growth rate (CAGR) of around 10%-15%, it’s evident that the company’s growth trajectory is topsy-turvy.
| GTL Infra Revenue Growth (2020-23) | |
| Year | Revenue (in Crores) |
| 2020-21 | 1,410 |
| 2021-22 | 1,463 |
| 2022-23 | 1,458 |
Profit growth: This is a major issue, despite the revenue of GTL Infra growing at a slow pace, but the company’s profits are still negative.
The reason for this negative growth is debt interest and underutilization of its infrastructure.
Huge debt: The debt is almost 5 times greater than the market cap of GTL Infra which is around 950 crores. The primary reason for this debt was the insolvency of Aircel and Tata Teleservices (Tata Docomo) because both telecom companies were using GTL Infra’s towers which are then got abandoned.
The company has repaid Rs 2,700 crore to lenders till 2022 which is a positive sign.
Technical Analysis of GTL Infrastructure
GTL Infra’s technical evaluation presents a diverse analysis, with the moving averages signaling a robust sell – displaying 13 sell recommendations, 1 neutral position, and 1 buy indication. It’s like a blend of different notes in a symphony, each contributing to the overall tune of the stock’s performance.
Furthermore, let’s delve into the stock’s position in relation to its Exponential Moving Averages (EMA). The stock price is currently below the EMA50 by a factor of 1.46 and below the EMA200 by a margin of 13.36. This data provides insights akin to examining the details of brushstrokes that compose a larger artistic masterpiece.
But that’s not all. The Relative Strength Index (RSI), which stands at 41.1, and the Stochastic Oscillator, measuring 15.28, are displaying a neutral signal. These figures are akin to the emotions and expressions conveyed by actors on a stage – indicating a state of equilibrium, neither tipping towards overbought nor oversold territory.
You can also use the technical indicators to predict the next candlestick pattern for the stock price.
GTL Infra’s Business Prospects
As per the joint report from esteemed sources including Google and two other reputable firms, the Indian telecom sector gears up for a phenomenal six-fold expansion by 2030.
And India’s 5G subscribers are expected to surge to a monumental 350 million by 2026, which would create a huge demand for network towers to be installed in remote areas to increase the reach of the internet to distant places.
This surge in demand may help GTL Infrastructure to stabilize its financials and its potential seems promising with the expansion of the telecom industry infrastructure.
Major Risks of Investing in GTL Infra
- Financial Strain in Telecom Sector: Despite recent relief measures announced by the Government in September 2021, the overall financial health of Telecom companies (Telcos) continues to be a concern. The rollout of 5G services, which requires significant investment in infrastructure, could potentially strain the finances of Telcos. Delays and defaults in payment to Tower Companies, like GTL Infra, have already been observed.
- Risks in Pricing upon Renewals: If GTL Infra faces unfavorable terms, such as lower pricing, when renewing agreements with Telcos, it could negatively affect the company’s cash flow. Changes in pricing terms could impact the profitability of the business.
- Effects of Operator Consolidation: Over the past few years, the Indian Telecom sector has witnessed consolidation and exits, leading to a reduction in the number of Telcos from 18 to 4. Further consolidation in the industry could result in decreased demand for additional tower sites, affecting GTL Infra’s growth prospects.
- Competition: Telcos have a vested interest in Tower Companies like GTL Infra. These Tower Companies are likely to receive preference for new tower sites from Telcos, potentially limiting GTL Infra’s opportunities for expansion.
- Impact of Spectrum Sharing: If spectrum sharing is allowed in India, it could have a negative impact on the demand for additional tower sites across Telcos. This change might affect GTL Infra’s business, as the need for new sites could decrease.
- Traffic Off-Loading onto Micro Sites: With the expected surge in traffic volume over the next few years, Telcos might offload a significant portion of their traffic onto smaller infrastructure like microsites, small cells, and Wi-Fi. This shift could lead to slower growth than anticipated in the occupancy of larger macro sites, which are GTL Infra’s focus.
Conclusion
GTL Infra is striving to stay afloat amidst a storm of past troubles, and the waves of uncertainty causing its share price to plunge by 48%.
Examining the past, we find GTL Infra entangled in multiple issues, causing concerns among investors. This turmoil has taken a toll on its stock, leading to a significant drop.
But it’s not a good buy at least for the time being because the experts cast a shadow of doubt over the prospect of immediate robust returns.
However, the telecom sector in India is anticipated to flourish by 2030, bringing with it a potential silver lining. As this sector booms, it’s not unreasonable to anticipate GTL Infra’s share price ascending to the range of Rs 2 to Rs 2.50.
You can make up your mind if you have a long-term perspective but remember you should always be cautious while investing in such penny stocks.
You can also read about other stocks’ target prices –
- Tata Power Share Price Target
- Adani Power Shares Target Price
- Suzlon Energy Share Price Target
- JP Power Share Price Target
FAQs
Over the past few years, GTL Infrastructure has shown impressive revenue growth, indicating a promising trajectory for the company.
While predictions can’t be exact, based on analysis, the share price could potentially witness a growth of 20-25% by 2025 and 40-50% by 2030.
Market volatility, regulatory changes, and competition are some of the key risks to consider before investing in GTL Infrastructure.
