TLKM
Contact our analyst Eka
30th March 2023
BUY
Price Rp 4,100
Target price Rp5,600
BUY
Price Rp 4,100
Target price Rp5,600
Stable revenue
- TLKM booked stable revenue in 4Q2022, with Indihome and Telkomsel continuing to be the engines of growth. TLKM revenue reached IDR 38.4 trillion, up +3.4% YoY or +4.2% QoQ. For 2022FY TLKM revenue grew +2.9% YoY to IDR 147.3 trillion.
- IndiHome recorded +6.6% YoY growth to IDR 7.13 trillion in 4Q2022, the highest quarterly revenue in 2022. For 2022, IndiHome revenue reached IDR 28.0 trillion with +6,4% YoY growth, inline with the increase in IndiHome new subscribers and a stable ARPU at IDR 268 thousand in 4Q2022. Indihome’s total subscribers are now 9.2 million and the target is to add 1 million more subscribers in 2023.
- Data, Internet & IT service revenue increased +5.1% YoY to IDR 86.4 trillion in 2022 and +2.7% YoY in 4Q2022, boosted by higher cellular data internet revenue, +7% YoY in 2022.
- Going forward, we are targeting TLKM revenues to reach IDR 159 trillion this year as we expect demand will continue to grow due to higher data consumption and price increases in 2023.
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4Q2022 Results: More losses from GOTO
Valuation: Maintain BUY with TP 5,600
- After a drop in 3Q2022 due to losses from GOTO, TLKM’s bottom line recovered with 27.5% QoQ growth in 4Q2022 to IDR 4.17 trillion, but was still lower than a year ago, by -29.1%. As a result, TLKM NPM reached 10.9% from 8.9% in 3Q2022. For 2022FY, TLKM bottom line decreased -16.2% YoY to IDR 20.7 trillion.
- The unrealized loss from the change in fair value of the investment in GOTO reached IDR 6.4 trillion by the end of 2022FY. As of 31 December 2022, GOTO market price was IDR 91 per share from previously IDR 375 per share as of 31 December 2021.
- Operating profit also decreased -28.9% YoY or -7.3% QoQ to IDR 8 trillion with a lower OPM of 20.8% from 30.3% in 4Q2021.
- Going forward, we expect a merger of IndiHome and Telkomsel will help make capex more efficient and there will be IPOs of TLKM subsidiaries PT Sigma Tata Sadaya and PT Telkom Data Ekosistem on to the IDX.
Valuation: Maintain BUY with TP 5,600
- We are targeting TLKM to reach IDR 5,600, 37% upside, which is a 20x PE valuation within one year. We maintain our recommendation to BUY.
Previously