- Telkom reported rather soft results in the 4Q21 thanks to rising expenses but an unrealized gain from its investment in GoTo, a non-operating income, came to rescue.
- While the management believes that the company is heading toward a healthier competitive landscape, we believe that the industry is dynamic, possibly intensified by the newly-merged Indosat Ooredoo Hutchison.
- However, Telkom has launched a few initiatives, such as data center business and fixed-mobile convergence service, to open up new sources of revenue growth.
- We arrive at a 12-month target price of US$33.6 per share via DCF (11% WACC and 3% of long-term growth).
- Intensifying competition in the mobile service industry and a delay in 5G monetization are risks to consider.
For further details see:
Telkom: Shifting Toward A Digital Telco