TLKM Aug2026

TLKM

Contact our analyst Eka

13th August 2026
BUY, 53% upside
Price Rp 2590
Target price Rp3950

Mobile ARPU Improvement continues in2Q26

PT Telkom Indonesia (Persero) Tbk (TLKM) reported revenue growth of 6.4% YoY to IDR38.7 trillion in 2Q26, bringing 1H26 revenue to IDR75.8 trillion, up 4.0% YoY. Performance was supported by improving mobile monetization, disciplined cost management, and more selective capital expenditure.
The B2C segment continued to lead the Group’s external revenue growth. Data, Internet & IT Services revenue increased 12.6% YoY to IDR38.5 trillion in 1H26, including strong growth of 20.0% YoY to IDR26.3 trillion in 2Q26. The improvement reflected stronger pricing discipline, product simplification, and customer value management.
Mobile ARPU increased 2.0% QoQ and 9.0% YoY to IDR46,000 in 2Q26. Data consumption remained resilient at 11,525 petabytes, increasing 0.7% YoY. However, Telkomsel’s mobile subscriber base declined 3.1% YoY to 153.5 million, reflecting the company’s continued focus on subscriber quality and monetization rather than headline customer growth.
IndiHome revenue declined 3.4% YoY to IDR12.8 trillion in 1H26, reflecting intensified competition and Telkomsel’s strategic recalibration of its fixed broadband customer base. Fixed broadband ARPU remained 5.9% below the prior-year level, although it improved 3.4% QoQ.
Sequentially, IndiHome showed early signs of stabilization, with revenue increasing 0.7% QoQ to IDR6.4 trillion in 2Q26. The company is shifting its fixed broadband strategy away from subscriber volume-led expansion toward a quality-focused model based on customer verification, reuse of existing network ports, network modernization, premiumization, and fixed-mobile convergence.
The convergence ratio improved further to 65% in 1H26, compared with 59% in 1Q26 and 55% in 1H25, indicating continued progress in integrating mobile and fixed broadband services.
Overall, TLKM’s 1H26 revenue performance remained broadly in line with management’s FY2026 growth guidance of 1%–3%..

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Further streamlining Initiatives in 2026

TLKM continued to implement its TLKM30 transformation program, with portfolio rationalization remaining a key component of the strategy. The initiatives include the divestment of 17 entities, closure of 12 entities, and merger or transfer of five businesses.
Following the completion of the AdMedika and TelkoMedika divestments in June 2026, TLKM continued to simplify its corporate structure. Phase 1 of the Infranexia asset transfer was completed in December 2025, while Phase 2 was completed on 7 August 2026.
TLKM has also closed several non-core businesses, including Media Nusantara Data Global, Sigma AIT Bhd., Napsindo, PT Alam Pesona Wisata, Pointer, Telin Australia, PT Omni Inovasi Indonesia, and CSM Satellite & Terrestrial Network. In addition, selected Mitratel subsidiaries, including UMT and Persada Sokka, were merged as part of the broader restructuring process.
These initiatives are expected to simplify the Group’s organizational structure, improve capital allocation, and support greater operating efficiency over the medium term.

Q2 2026 Results: Earnings and Margins Improve

TLKM recorded net profit of IDR6.28 trillion in 2Q26, increasing 22.3% YoY and 44.5% QoQ. Net profit margin improved to 16.2%, reflecting stronger quarterly profitability.
Core profit increased 9.9% YoY and 20.1% QoQ to IDR6.16 trillion in 2Q26. For 1H26, core profit reached IDR11.3 trillion, representing growth of 1.4% YoY.
Core profit excludes several accounting, valuation, tax, and transaction-related items, including IDR867 billion of additional depreciation resulting from revised network asset useful lives, a IDR429 billion gain from the AdMedika divestment, IDR235 billion of unrealized losses on Telkomsel’s investment in GoTo, and IDR50 billion of transformation advisory expenses.
The improvement in underlying earnings indicates that TLKM’s operational performance strengthened in 2Q26 despite the continuing impact of transformation-related and non-cash items.
Cost discipline remains a key management priority, supported by continued subsidiary streamlining and further optimization of both capital expenditure and operating expenditure.

Valuation: Maintain BUY, TP IDR 3,950 (+53% Upside)

We maintain our BUY recommendation on TLKM with a 12-month target price of IDR3,950, implying 53% upside from the current share price.
Our valuation is based on a 16x forward P/E multiple, supported by continued mobile ARPU recovery, improving industry pricing discipline, ongoing portfolio streamlining, and potential value realization from strategic partnerships.

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