PT Bakrie Telecom Tbk is an Indonesian telecommunications operator that provides fixed digital radio cellular telecommunication network and services. Its operational areas are located in more than 80 cities across West Java, Central Java, East Java, Bali, Sumatra, Sulawesi and Kalimantan. The company currently has around 12 million subscribers. Bakrie Telecom is a subsidiary of the politically-linked Bakrie & Brothers holding company. In Indonesian media, Bakrie & Brothers and several subsidiaries are portrayed as controversial because of debt woes and (corruption) scandals. In April 2013, Fitch Ratings said that Bakrie Telecom is likely to default on its debt and is in need to restructure debt.
|Industry Sector||Infrastructure, Utilities & Transportation|
|Industry Sub Sector||Telecommunication|
|Established||13 August 1993|
|Listed||3 February 2006|
|Listed Company Code||BTEL|
|Major Shareholders (>5%)||Bakrie & Brothers (16.49%)
Bakrie Global Ventura (9.49%)
Raiffeisen Bank International AG, SG (7.24%)
|Key Subsidiaries||Bakrie Connectivity
Bakrie Telecom Pte. Ltd
Stock Quote Bakrie Telecom - BTEL:
PT Bakrie Telecom Tbk is one of the dozen Indonesian companies that compete for domestic market share in the lucrative Indonesian telecommunications market. According to data from the Indonesian Cellular Phone Association (ATSI), there are over 200 million cellular service subscribers in the country out a total population of around 240 million people. Indonesia's young population in combination with rising per capita GDP is reason that Indonesia is one of the world’s most crowded telecommunications markets.
In recent years Bakrie Telecom has shown a steady rise in number of cellular subscribers except for the year 2012 when it lost a significant amount of subscribers and experienced a setback in its financial performance.
Bakrie Telecom's Operational Highlights:
|Number of Cellular Subscribers
| – prepaid
Source: Bakrie Telecom, Annual Report 2014
Bakrie Telecom is involved in the planning, developing, and leasing of telecommunication equipment/facilities, marketing and selling of telecommunication networks and/or services, and the selling of telecommunication products or utilities. The company is also engaged in the research and development of telecommunication equipment/facilities, operates a local fixed wireless network with limited mobility frequency bandwidth, and provides fixed direct line long-distance connections, as well as post-paid services and pre-paid cards. Its main product is Esia which is a service that focuses on voice and text messaging service. Bakrie Telecom’s Esia is one of the two biggest CDMA cellphone operators in the country.
Bakrie Telecom's Financial Highlights:
|Net Operating Revenue||2,742.6||2,765.1||2,591.0||2,361.0||2,072.4||1,179.2|
|Net Income (loss)
|Net Profit per Share¹
in billion IDR rupiah, except stated otherwise
¹ in IDR rupiah
Source: Bakrie Telecom, Annual Report 2014
Future Outlook of the Indonesian Telecommunication Sector
Indonesia is unique in the sense that mobile phones are the primary tool for telecommunication. Not only with regard to telephony but also in terms of internet usage. Mobile phones are used as main tool device to access the internet by Indonesians. Mobile phone penetration has surged from 20 percent in 2005 to - currently - over 80 percent (although about 30 percent of Indonesian subscribers hold more than one SIM card). This indicates that the mobile phone subscription market is heading towards saturation; growth in voice and SMS revenue is stagnating. Internet penetration, however, is relatively low, thus having ample room for growth in the near and middle term future. High-speed broadband services are now the new focus of telecommunication companies. However, profit from call services remains to be the primary source of income for Indonesian mobile operators.
Indonesia is also unique in the sense that the country is predominantly a voice market due to low voice tariffs set by operators. Over 60 percent of total revenue in the mobile service sector is derived from voice services, while the remainder comes from non-voice or data services. The growing popularity of smartphones, however, contributes heavily to the growing data revenues. According to data from Frost & Sullivan, a consulting firm, smartphone penetration in Indonesia will exceed 50 percent in 2015 from only nine percent in 2012. The firm believes that the Indonesian market is in the early to middle stage of data usage increase.
Due to the promising perspectives of the mobile phone sector in the last decade, a number of companies are in fierce competition for market shares. Out a total of 11 telecommunication operators, five companies control a combined market share of around 90 percent. These five are: Telekomunikasi Indonesia - and its subsidiary Telekomunikasi Seluler (Telkomsel) -, Indosat, XL Axiata and Bakrie Telecom. Competition has brought tariffs for mobile phone services down significantly, while a new group of subscribers (from the poorer segments of society) has limited spending capacity. Instead, companies now focus on data services (broadband services) and value added service to attract subscribers, both of which are estimated to grow by 35 percent up to 2014. In 2011, there were around 70 million mobile phone data services users. This is estimated to increase to 160 million by 2015.
Wisma Bakrie, 2nd Floor
Jalan H.R. Rasuna Said Kav. B-1,
Jakarta - 12920
Phone: +6221 9110 1112
Fax: +6221 9110 1110