September 8, 2022
JAKARTA – Telecommunication firms (telcos) across Asia-Pacific are expected to see revenue grow next year at the fastest pace since 2016, thanks to soaring demand for data and broadband in the region.
Investment in 5G networks is expected to rise further in Asia-Pacific emerging markets like Indonesia, China, India, Malaysia and the Philippines, with capital expenditure (capex) intensity to be around 30-33 percent, according to a report released by Moody’s Investors Service on Wednesday.
Capex intensity is the ratio of capex in relation to sales.
Moody’s senior vice president Annalisa di Chiara highlighted that capex growth at telcos in the region’s more developed markets –namely Australia, Hong Kong, South Korea, Japan, Singapore and New Zealand– was estimated to stagnate at just 16-18 percent. ‘
“APAC’s data and broadband consumption will thrive, while further consolidation will temper competition over the next few years. These buoyant conditions will propel revenue at a pace of 4 to 4.5 percent through 2023,” she said, as quoted in the report.
Meanwhile, Moody’s vice president and senior analyst Nidhi Dhruv noted that most APAC telcos were facing profitability pressure due to stiff competition, although they could still fund their capex from cash flows.
“Sector-wide average leverage will remain stable at 2.3x to 2.5x, supported by EBITDA growth and relatively unchanged debt levels from 2021,” she said.
PT Telkom Indonesia posted consolidated annual revenue growth of 3.6 percent to Rp 72 trillion (US$4.81 billion) in the first half of this year.
Telkom’s EBITDA over the same period rose 4.5 percent to Rp 39.4 trillion, while its net income hit Rp 13.3 trillion, up 6.9 percent year-on-year (yoy).
A tower owned by PT Dayamitra Telekomunikasi (Mitratel) is pictured in an undated photograph in Langsa, Aceh. (Mitratel/-)
According to Telkom’s latest financial report, the achievement was supported by the company’s focus on digitalization.
Telkom president director Ririek Adriansyah said the state-owned telco continued to boost its competitive advantage, for example by listing its subsidiary Mitratel last year and by consolidating its data center business.
“We are also preparing new growth engines with fixed mobile convergence, B2B IT services as well as selected investment in digital companies,” he said in a statement last month. [
RA:Telkom to acquire state-run production house amid Netflix trouble::https://www.thejakartapost.com/business/2022/06/09/telkom-to-acquire-state-run-production-house-amid-netflix-trouble.html]
During the first half of this year, Telkom’s revenue composition shifted in line with the firm’s ambition to grab more income from its digital business, as the contribution of legacy revenue streams, such as SMS and MMS, continued to slide.
Telkom’s mobile communication subsidiary Telkomsel recorded revenue of Rp 43.6 trillion in the first six months of 2022 thanks to 21.4 percent yoy growth in data traffic.
Telkomsel dominates the domestic market with 169.7 million users at the end of June, including 119.3 million data users.
To develop infrastructure supporting its digital business, Telkomsel has built 154,000 4G base transceiver stations (BTS) and is gradually building 5G BTS.
In total, Telkomsel owned 255,107 BTS at the end of the first half of 2022, up 7.5 percent yoy, of which 204,908 were 3G/4G/5G BTS.