Indosat (ISAT.JK): Reinstating Rating and TP: Top ASEAN Telco pick

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Indosat (ISAT.JK): Reinstating Rating and TP: Top ASEAN Telco pick

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15 Jul 2026 05:01:00 ET │ 17 pages

Indosat (ISAT.JK)

Reinstating Rating and TP: Top ASEAN Telco pick

CITI'S TAKE

Buy from Rating Suspended We reinstate coverage of Indosat with a Buy rating and a TP of Rp2,500

after a period of Rating Suspended. We believe Indosat remains attractive Short-Term View: Upside

with a combination of deep value (<4x FY26 EV/EBITDA), high growth Price (14 Jul 26 16:00) Rp1,860

(15% 3-YR CAGR) and high yield (7-9% for '26-27). Our forecasts have Target price Rp2,500

been adjusted to reflect the company's recent Rp11.7tn fiber infrastructure from -

asset spin-off, which has translated to ~Rp1.6tn one-off gains for FY26 Expected share price 34.4% and reduced balance-sheet gearing. This would help reduce subsequent return

years' financing charges. We believe Indosat remains the best exposed Expected dividend yield 7.4%

play to mobile market repair in Indonesia and our most preferred telco Expected total return 41.8%

pick within the market/ASEAN.

Market Cap Rp59,986,508M

US$3,374M

Earnings revisions — We have revised our estimates to reflect the partial

divestment of its fiberco with ~Rp11.7tn in cash proceeds received. Following this,

Indosat's FY26 net debt/EBITDA has declined to ~1.7x (from 2.0x), which places it at

among the lowest end in the ASEAN telcos sector. We also raise FY26-28 recurring Arthur PinedaAC

NPAT by 4-9% with the benefit of reduced interest charges. Following the sale, the +65-6657-1174

company will also book Rp1.6tn in pre-tax gains in 3Q26, although we do not expect arthur.pineda@citi.com

it to have any bearing on the company's dividend outlook; it is likely to be anchored

to recurring NPAT, which faces mild upside owing to deleveraging benefits.