XLSmart (EXCL) Gets Fresh Catalyst as Indonesia Spectrum Auction Nears, Analysts Keep Buy Call With Higher Growth in Sight

JAKARTA, Investortrust.id — PT XLSmart Telecom Sejahtera Tbk (EXCL), one of Indonesia's largest mobile network operators, is entering what analysts see as its next growth phase as the country prepares to auction valuable 5G spectrum this week, reinforcing expectations for stronger earnings and sustained network expansion.

BRI Danareksa Securities reaffirmed its Buy rating on EXCL with a target price of Rp3,700 per share, citing accelerating network integration, expanding 5G deployment, and improving industry pricing dynamics as key drivers for future earnings growth.

Indonesia's 700 MHz and 2.6 GHz spectrum auction, scheduled for July 7-9, represents one of the country's most important telecom events in years. The auction will determine how operators expand nationwide 5G coverage while shaping long-term competition in Southeast Asia's largest digital economy.

For investors, the auction could unlock another phase of revenue growth as faster mobile networks encourage greater data consumption, improve customer retention, and support higher average spending per subscriber.

According to analysts Erindra Krisnawan and Kafi Ananta of BRI Danareksa Securities, XLSmart plans to increase capital expenditure to Rp15 trillion ($943 million) in 2026 from Rp11.1 trillion ($698 million) in 2025.

The larger investment will fund nationwide network modernization while preparing infrastructure for newly acquired 700 MHz and 2.6 GHz spectrum frequencies.

Network integration is also progressing ahead of schedule. Management said roughly 80% of the integration process had been completed by the end of the first quarter, with most remaining work expected to finish during 2026.

The company has already launched commercial 5G services across Jakarta since January, while 5G penetration has exceeded 20% in major markets including Bali and Surabaya.

Analysts said XLSmart also benefits from owning the country's largest portfolio of 5G base stations among its competitors, alongside valuable 2.3 GHz spectrum inherited from Smartfren following their merger.

They estimate wider 5G adoption could increase average revenue per user (ARPU) by roughly 10% to 20% as customers consume more high-speed mobile data.

Management also sees no signs that Indonesia's telecom pricing recovery is losing momentum.

Industry-wide "price repair" has been supported by tighter prepaid SIM card standardization and the removal of aggressive bonus packages that previously pressured operator profitability.

As a result, analysts expect second-quarter ARPU to remain broadly stable despite weaker seasonal demand following the Eid holiday period.

Indonesia's mandatory biometric SIM registration program has also been postponed until July 19. XLSmart believes the delay will have minimal financial impact because most inactive subscriber clean-up had already been completed during the first quarter.

Attention now turns to this week's spectrum auction.

Indonesia will conduct the auction over three days through 15 bidding rounds before announcing winners later this month.

Management said reserve prices are more attractive than in previous spectrum sales, while upfront payments will only be required once, significantly reducing initial funding needs.

The company added it has secured sufficient financing to participate aggressively in the auction if necessary.

BRI Danareksa said these catalysts support continued optimism toward EXCL, as integration synergies become more visible while one-off merger expenses and accelerated depreciation gradually normalize, positioning the telecom operator for its next stage of earnings growth.