Why Booming AI Data Centers Could Send Indosat Surging to New Highs

JAKARTA, Investortrust.id — Southeast Asia's exploding artificial intelligence buildout is handing PT Indosat Tbk (ISAT), one of Indonesia's largest telecommunications operators, a powerful commercial tailwind.

BRI Danareksa Sekuritas, a leading state-backed domestic brokerage, issued a decisive "Buy" recommendation on Indosat equity, establishing a bullish target price of Rp 3,430 ($0.22) per share as enterprise demand for high-density computational capacity surges.

Global technology giants are pouring billions into Southeast Asian cloud computing hubs to support generative AI models, turning the digital plumbing of emerging economies into prime real estate. If regulatory caps or power constraints choke expansion in regional hubs like Malaysia and Thailand, Indonesia stands as the prime beneficiary. With operational capacity trailing demand by wide margins, domestic telecom players controlling high-bandwidth transport networks and prime enterprise links are positioned to capture outsized commercial windfalls.

A Massive Compute Supply Gap

Real estate services giant Jones Lang LaSalle (JLL) estimates pipeline data center demand across Indonesia has swelled to roughly 2 gigawatts. That appetite dwarfs the operational baseline of the Greater Jakarta industrial region, which stood at just 400 megawatts in 2025.

BRI Danareksa underscored that this structural deficit creates vast operational runway for established connectivity operators. The opportunity could widen significantly if cross-border infrastructure constraints in neighboring markets push hyperscalers toward Indonesian soil.

Powering this surge is the rapid rollout of specialized graphics processing units (GPUs) tailored for deep learning workflows. While traditional legacy racks draw just 5 to 10 kilowatts of electricity, AI-dedicated GPU racks consume 30 to 40 kilowatts, reaching 60 to 100 kilowatts when paired with sophisticated liquid-cooling enclosures.

Clearing the Power and Water Gridlock

Despite intense commercial interest, the sector faces critical engineering challenges tied to municipal utilities rather than raw power generation. JLL identified the primary hurdle as localized electrical distribution and connection rather than basic generating reserves.

To break these bottlenecks, state-owned electricity monopoly PT PLN (Persero) is preparing to construct new high-voltage substations across the manufacturing hubs of Karawang, Purwakarta, and Subang. The state utility aims to deliver 2 gigawatts of dedicated grid capacity to those industrial nodes between 2028 and 2029.

Heavy water consumption presents an equally complex hurdle for enterprise developers. Modern artificial intelligence facilities require 211,888 to 529,720 cubic feet of cooling water daily, prompting operators to favor master-planned industrial parks equipped with internal water-treatment works.

While rapid GPU hardware upgrades and regulatory shifts present operational risks, domestic brokers argue that structural compute deficits will keep market fundamentals firmly in Indosat's favor.