Bottoming out – tactically positive Quick Note

Research evidence excerpt

Bottoming out – tactically positive Quick Note

Nomura Securities Malaysia Sdn Bhd

Sarana Menara Nusantara TOWR.JK TOWR IJ 15 June 2026

EQUITY: TELECOMS

RatingBottoming out – tactically positive Remains Buy

Target price IDR 950 RemainsQuick Note

Closing priceOver the past 12 months, TOWR share price has declined by ~50% (the most amongst its 12 June 2026 IDR 344

peers; JCI down 16.6% over the same period). We attribute the decline to, amongst

others, the company’s rising gearing level (with net debt-to-EBITDA at over 4x – highest in

the industry), following a slew of acquisitions as well as tower rental yield repricing. These Research Analysts

have translated into lower ROAAs as well as dividend yields. However, we think earnings Indonesia Research Teamshould bottom out, as we expect: 1) risks of rental repricing should diminish, and 2) rising

Heng Siong Kong - NSMtenancies on fiber assets (hence asset turnover) as data traffic is on a structural uptrend. hengsiong.kong@nomura.com

The recent capital raising, too, should mitigate the risks associated with rising financing +603 2027 6894

rates. Combined with reduced major fiber capex, we anticipate ROAA to improve in the

medium term. These developments should drive down net gearing to below 4.0x (net debt- Onshore expert

to-EBITDA in 2026F).

Erwin Wijaya (erwin.wijaya@verdhana.id)

Improving yield

Theonshoreexperts,whoareImproving earnings and a lower gearing level, should allow the company to increase

employedbyPTVerdhanaSekuritasdividend payouts. Historically, the company has had a payout ratio of 35-50%. Assuming a

Indonesia(“Verdhana”)andarenotpayout ratio of 35%, we estimate the dividend yield to recover from a low of ~2.0% in 2026 licensedoutsideIndonesia,have

to ~7-8% for 2027F – above the risk-free securities.