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29 May 2020 (closed)
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PT Indosat Ooredoo Tbk is one of Indonesia's largest telecommunication networks and services provider with currently around 63 million cellular subscribers. The company offers (prepaid and postpaid) mobile phone services, fixed voice (including IDD) services, fixed wireless and fixed telephone services.
|Industry Sector||Infrastructure, Utilities & Transportation|
|Industry Sub Sector||Telecommunication|
|Established||10 November 1967|
|Listed||19 October 1994|
|Listed Company Code||ISAT|
|Major Shareholders (>5%)||Ooredoo Asia Pte. Ltd. (65.00%)
Government of Indonesia (14.29%)
Skagen AS (5.51%)
|Key Subsidiaries||Indosat Palapa Company B.V.
Indosat Mentari Company B.V.
Indosat Finance Company B.V.
Indosat International Finance Company B.V.
Indosat Singapore Pte. Ltd.
Indosat Mega Media
Stock Quote Indosat Ooredoo - ISAT:
Together with its subsidiaries Indosat Mega Media (IM2) and Aplikanusa Lintasarta, Indosat provides fixed data services or Multimedia, Internet and Data Communication (such as IP-VPN), leased line and internet services. For a long time, Indosat had been a dual-listed company on both the New York Stock Exchange (NYSE) and Indonesia Stock Exchange (IDX). However, on 16 May 2013, it was delisted from the NYSE on request of the company for reasons of cost efficiency.
In recent years, the company has lost a couple of percentage points in terms of market share on the mobile phone market in Indonesia. Currently, the company holds a market share of around 21 percent.
Indosat - originally established in Indonesia as a Foreign Investment Company (PMA) in 1967 - was bought and thus fully owned by the Indonesian government in 1980. In 1994, the government listed the company on both the New York Stock Exchange (NYSE) and the Indonesia Stock Exchange (IDX) but kept 65 percent of the company's shares. In 2001, the company established PT Indosat Multimedia Mobile (IM3) that pioneered with its mobile operator GPRS network and multimedia services in Indonesia, followed in 2006 by acquiring the license for 3G networks and introduced 3.5G to Jakarta and Surabaya.
Indosat gains most of its revenues from its cellular phone business segment (83 percent), followed by fixed data; MIDI-Multimedia, communication data & internet (13 percent), and fixed telecommunication (4 percent).
Operational Highlights Indosat Ooredoo:
¹ in millions
Indosat's Financial Highlights:
|Net Income (loss)
in trillion IDR (rupiah), unless stated otherwise
¹ in IDR (rupiah)
Source: Indosat, Annual Report 2016
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.
Projection Indosat Ooredoo's Future Corporate Earnings:
|P/E Ratio (x)||15.6||9.4|
in billion IDR, unless otherwise stated
Source: Trimegah Sekuritas (27.02.2020)
Jalan Medan Merdeka Barat No. 21
Jakarta - 10110
Phone: +62 21 3000 3001
Fax: +62 21 3000 3754