TLKM - FMC drives 4Q rebound, 2026F margins strengthen

KBVS Update
Monday, 15 December 2025

TLKM – FMC drives 4Q rebound, 2026F margins strengthen
(Reiterate BUY - TP: IDR3,900)

4Q25F preview: FMC drives snapback, EBITDA +7.3% qoq. TLKM should deliver a stronger 4Q25F, with FMC momentum lifting TLKM’s consolidated revenue to IDR40.9 tn (+11.6% qoq). Cost pressure remains, but lower interconnection helps offset O&M inflation. EBITDA is set to rebound 7.3% qoq to IDR19.6 tn on firm FMC monetisation.

2026F outlook: solid operating momentum with margin lift from cost-discipline. Into 2026F, growth is supported by B2B expansion and deeper FMC penetration. Enterprise revenue should rise 4% yoy, while Telkomsel’s combined revenue grows 3.8% yoy on stable subs, firmer data usage and IndiHome B2C momentum. IndiHome subs remain resilient despite ARPU pressure, with convergence penetration reaching 55%. Disciplined cost management (cash-costs +3.1% yoy) supports a margin lift to 49.7%. Lower funding costs keep interest expense contained, driving net profit to IDR22.7 tn with stable margins.

Reiterate BUY with TP of IDR3,900, based on 5.5x ‘25F EV/EBITDA (+0.2SD of 7yrs-historical mean).

Regards,
Steven Gunawan - KBVS Research