Sarana Menara (TOWR) Has 56% Upside, Analyst Says Digital Infrastructure Push Could Lift Profit to $255 Million

JAKARTA, Investortrust.id — Shares of PT Sarana Menara Nusantara Tbk (TOWR) could rally as much as 56% as Indonesia's leading telecommunications infrastructure company transforms itself beyond traditional cell towers into a broader digital infrastructure provider, according to Phillip Sekuritas.

The brokerage reiterated its Buy recommendation with a target price of Rp580 per share, compared with Friday's closing price of Rp372, arguing that the market has yet to fully recognize the value of TOWR's fast-growing fiber, connectivity, data center, and renewable energy businesses.

Indonesia's digital economy is driving demand for next-generation infrastructure beyond mobile towers. As data consumption accelerates and cloud adoption expands, companies with diversified exposure to fiber networks, data centers, and digital connectivity are increasingly viewed as long-term infrastructure plays rather than traditional telecom tower operators.

Phillip Sekuritas analyst Edo Ardiansyah said TOWR's diversification strategy should support both earnings growth and a higher valuation multiple over time.

The brokerage expects the company to generate Rp13.73 trillion ($864 million) in revenue in 2026, up from Rp13.33 trillion ($838 million) in 2025. Net profit is projected to rise to Rp4.05 trillion ($255 million) from Rp3.68 trillion ($231 million) a year earlier, before climbing further to Rp4.53 trillion ($285 million) in 2027.

The stronger earnings outlook is supported by the rapid expansion of businesses outside TOWR's legacy tower operations.

During the first quarter of 2026, consolidated revenue increased 10.8% year over year to Rp3.5 trillion ($220 million), with growth driven entirely by non-tower segments.

Revenue from connectivity services surged 44.4% to Rp502 billion ($31.6 million), while Fiber-to-the-Tower (FTTT) revenue rose 3.7% to Rp569 billion ($35.8 million). Revenue from other businesses more than doubled to Rp269 billion ($16.9 million).

The gains offset a 4.1% decline in traditional tower revenue to Rp2.1 trillion ($132 million).

Profitability also improved. EBITDA climbed 3.8% year over year to Rp2.7 trillion ($170 million), while net profit attributable to shareholders jumped 17.2% to Rp941 billion ($59.2 million), helped by a 26.2% decline in financing costs.

According to Phillip Sekuritas, the market still undervalues TOWR's ongoing transformation into an integrated digital infrastructure platform.

By March 2026, the company's revenue-generating Fiber-to-the-Tower network had expanded to 237,837 kilometers (147,785 miles), an increase of 8.7% from a year earlier.

Its Fiber-to-the-Home (FTTH) network reached 1.83 million home passes, with 289,785 connected homes, representing annual growth of 58.6%.

Non-tower businesses accounted for 42% of first-quarter revenue, up sharply from 33% a year earlier, highlighting the company's accelerating business diversification.

TOWR is also expanding through subsidiaries Protelindo and iForte into higher-growth businesses including data centers, renewable energy, and wireless infrastructure.

Phillip Sekuritas estimates the company's Rp2.07 trillion ($130 million) investment program will generate a positive net present value of Rp1.33 trillion ($84 million) and contribute as much as 26% of consolidated revenue generated in 2025 over the 2026–2035 period.

Alongside its expansion strategy, TOWR is streamlining its corporate structure by planning to delist subsidiaries PT Solusi Tunas Pratama Tbk (SUPR) and PT Inti Bangun Sejahtera Tbk (IBST). The move is expected to improve operational efficiency and simplify the integration of the group's tower and fiber assets, strengthening its position as one of Indonesia's largest integrated digital infrastructure companies.